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Three keys to M-PESA’s success: Branding, channel management and pricing

Author

Listed:
  • Mas, Ignacio
  • Ng’Weno, Amolo

Abstract

M-PESA, a mobile-phone-based electronic payments system, has been adopted by 8.5 million Kenyans in the relatively short span of three years. Surveys of users show it is a highly valued service, and Safaricom continues to expand the range of applications for which it can be used. This paper explores how Safaricom, the mobile operator that commercialises M-PESA, managed to create enough traction with both customers and retail stores, building trust and overcoming the adverse network effects that afflict new payments systems. The focus is on three key aspects of M-PESA’s success: (i) creating awareness and building trust through branding; (ii) creating a consistent user experience while building an extensive channel of retail agents offering cash in/cash out services; and (iii) a customer pricing and agent commission structure which focuses on key drivers of customer willingness to pay and incentivises early adoption.

Suggested Citation

  • Mas, Ignacio & Ng’Weno, Amolo, 2010. "Three keys to M-PESA’s success: Branding, channel management and pricing," Journal of Payments Strategy & Systems, Henry Stewart Publications, vol. 4(4), pages 352-370, December.
    • Handle: RePEc:aza:jpss00:y:2010:v:4:i:4:p:352-370
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    Cited by:

    1. Pédussel Wu, Jennifer & Metzger, Martina & Neira, Ignacio Silva & Farroukh, Arafet, 2023. "What determines demand for digital community currencies? OurVillage in Cameroon," IPE Working Papers 209/2023, Berlin School of Economics and Law, Institute for International Political Economy (IPE).

    More about this item

    Keywords

    M-PESA; mobile payments; mobile money transfer; remittances;
    All these keywords.

    JEL classification:

    • G2 - Financial Economics - - Financial Institutions and Services
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit

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