PayPal and Safaricom have announced a collaboration that will see users in Kenya deposit and withdraw between their M-PESA and PayPal accounts seamlessly in a move expected to take on Equity Bank-PayPal withdrawal only service.
According to Joseph Ogutu, Director of Strategy, Safaricom, “M-PESA’s cooperation with PayPal will open up global market places and the global economy to millions of Kenyan and Kenyan-based businesses and individuals. This development ushers in a new era of speed and convenience beyond borders, as we work towards innovating robust platforms through which more entrepreneurs and consumers can benefit from international money transfers and the growing eCommerce industry.”
Though the service aims to eliminate delays and significant barriers that have hindered consumers and businesses in the country from taking full advantage of global eCommerce, users will have to wait for 48 hours or more to get their transactions approved. Just like they wait with Equity Bank leaving the smaller individual players ready to provide instant transfers for their customers even though they do the withdrawals illegally and expensively-up to 10% in transaction costs.
Another challenge has been their fluctuating exchange rates and availability of liquidity especially for bulky transfers. This new partnership removes those barriers. But still slow because it takes two days for someone to withdraw meaning small players will not be out-competed from the sector.
“PayPal’s collaboration with M-PESA is part of the company’s long-term strategy to enable eCommerce and democratise financial services on the African continent,” says Efi Dahan, General Manager for the Middle East, Africa and Russia, PayPal. “We are excited to bring the M-PESA mobile wallet and PayPal joint services to the Kenyan market, which makes it more convenient and secure for users to withdraw and add money to their accounts while participating in the global digital economy.”
The new service makes it possible for Kenyan consumers with an M-PESA account to shop with online businesses across the world. With the new service Kenyan businesses and freelancers can now sell to global customers more easily, enjoying PayPal’s secure and trusted technology to collect their payment and the newly launched service to move their money to their M-PESA wallet.
The only issue with users will be the delays incurred in the process. It takes 48 hours or nearly two working days for a user to get their money deposited into their M-PESA wallet. This something the partners ought to solve. The partnership is also not so extraordinary from what smaller players in the market offer apart from the security of dealing with global players themselves and not third parties.
TransferTo operates a global Cross-Border Mobile Payments Network for emerging markets and is the technology partner underpinning this strategic collaboration.
Peter De Caluwe, CEO, TransferTo said this service is a major milestone in the evolution of cross-border mobile payments, in that TransferTo’s technology is creating a fundamental link between M-PESA users in Kenya and PayPal’s global network, and seamlessly connecting Kenyan shoppers and businesses to the global eCommerce world.
The service is now live and available to all Kenyans with qualifying PayPal and M-PESA accounts.
To register for the service and for more information please visit: www.paypal-mobilemoney.com/m-pesa.