Safaricom, the largest mobile money provider, and PayPal, the largest online money transfer service, have partnered in a bid to offer more seamless transactions between the two platforms. This is a welcome move in Kenya where many freelancers struggle to accept online payments.
The announcement barely a week after the giant telco announced an interoperability agreement with other telcos in Kenya to enable more seamless transactions among transcribers in the mobile money space.
According to Efi Dahan, GM, Middle East, Africa, Russia, PayPal, “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.
Joseph Ogutu, Director of Strategy, Safaricom, said that “M-PESA’s collaboration will PayPal will open up global market places and the global economy to millions of Kenyan and Kenyan-based businesses and individuals.”
Currently, only Equity Bank offers a PayPal link for freelancers to withdraw their funds onto their bank accounts. However, payments take up to three days before the recipient can withdraw. Other options have been the use of the Payoneer Card. All these options however come nowhere close to the ability to get the money via MPesa.
PayBill Number 800088
According to the TransferTo blog, the company bridging the gap between the two services, the new MPesa-PayPal service will enable PayPal account holders to connect it to their MPesa and receive payments and remittances via the Paybill number 800088.
Users will be able to not only receive but also load their PayPal accounts via MPesa. The new service also opens a way for Kenyan businesses and freelancers to sell to global customers more easily and take advantage of the growing eCommerce industry.
Transfers will be instant, but users will take three days before they can withdraw funds. MPESA limits and payouts will also apply with the new service. The Kshs. 140, 000 transaction limit with Kshs. 70,000 per transaction limit still applies. Equity however enables much larger sums via its bank transfer service, giving it an edge in this area.
This evolution is a major milestone in cross-border mobile payments. It also makes it much easier to now connect the growing crypto-payments space with mobile money services like MPESA.
Is Safaricom looking to partner with more payment providers? Will a Safaricom – crypto gateway partnership be the next move?
At the moment, we can only speculate. However the recent moves by Safaricom, first the interoperability with other mobile telcos in Kenya, and now a partnership with a major world-class payments provider, is a move in the right direction.