Apart from the clearance house, most banks use Safaricom’s M-Pesa to instantly send or transfer cash between their users and themselves hence incurring costs they could easily avoid.
To help address this, in June last year, there were reports that the Kenya Bankers Association (KBA) was working with external consultants to launch an inter-bank transaction platform
to cut out Safaricom’s M-Pesa which was disturbingly becoming dominant.
KBA today announced the said platform but TechMoran is yet to establish the working of the system but the association says it has established Integrated Payments Service Limited (IPSL) to provide inter-bank transfers to the association’s member banks, at subsidized rates.
KBA Chief Executive Officer, Mr. Habil Olaka, said, “IPSL, is therefore coming on stream to address the inefficiencies within the banking payments system in Kenya, with the value proposition for innovation, enhanced efficiency and risk management.”
Olaka added, IPSL is also part of a strategic effort by KBA to enhance ongoing financial inclusion efforts through diversified commercial banking delivery channels, including mobile and internet-based platforms as the country gears to become a cash-lite economy in line with the global digitization trends.
IPSL will soon be unveiling an interoperable, advanced person-to-person (P2P) payment solution. The solution is currently on its testing phase with a complement of more than 20 member banks participating in the User Acceptance Testing (UAT) trials.
IPSL will complement KBA’s existing, clearing house and is expected to provide a safe, secure and cost efficient platform for person-to-person (P2P) money transfer. These transfers will be initiated from the five main bank channels: Mobile banking (USSD & Application), Internet banking, ATM, Branch front office, Agency Banking and POS.