M-PESA’s market share declines as Airtel Money gains traction in Kenya. M-PESA’s share fell to 91%, while Airtel Money rose to 8.9% due to lower fees and strategic partnerships. Despite M-PESA’s dominance with 34 million users, its competitive landscape is changing, reflecting broader trends in the African mobile money market.
M-PESA, the leading mobile money platform in Kenya, is witnessing a decline in market share as Airtel Money grows increasingly competitive. Mobile money services have become essential in regions lacking traditional banking, with M-PESA historically dominating the market. However, recent data from the Communications Authority of Kenya indicates M-PESA’s market share has dropped to 91%, representing a decline of 2.3 percentage points over the last quarter. In contrast, Airtel Money experienced growth from 7.6% to 8.9% during the same period.
A key factor contributing to M-PESA’s decline is the affordability of Airtel Money. For instance, sending KES 1,000 ($7.7) incurs a fee of KES 11 ($0.085) with Airtel Money, compared to KES 13 ($0.093) on M-PESA. Additionally, withdrawing the same amount costs KES 29 ($0.22) on Airtel Money, providing a competitive advantage over M-PESA’s fees. Enhanced promotions and an expanding agent network have also bolstered Airtel Money’s customer base.
Airtel Money’s strategic partnerships, particularly with supermarket chains like Naivas, allow for greater accessibility for deposits and withdrawals. While M-PESA continues to have a more extensive agent network of over 160,000 agents nationwide, Airtel Money’s relationships with retail chains contribute to its growing market presence. This trend isn’t isolated to Kenya; similar declines are observed in other African markets, such as Nigeria, where MTN’s MoMo PSB recently reported a user drop.
Despite these challenges, M-PESA remains the foremost mobile payment platform in Kenya, boasting over 34 million users and facilitating over 30 billion transactions valued at approximately KES 40 trillion ($308.8 billion). Meanwhile, Airtel Money, which currently has about eight million registered users, is poised for further growth through its strategic initiatives and market adaptations.
In summary, M-PESA is facing increasing competition from Airtel Money as it sees a decline in market share. Factors such as lower transaction fees and strategic partnerships are giving Airtel Money a foothold in the mobile money market. While M-PESA still leads in overall users and transaction volume, its position is increasingly challenged by emerging competitors. The evolving landscape indicates that mobile money services must continuously adapt to retain their market dominance.
Original Source: www.techloy.com
