Since it’s inception, Safaricom’s mobile money product, that is, M-Pesa is, without any doubt, the telco’s largest money-maker. This is a financial product that makes the company stand out and continue growing every time as other financial divisions report loses.
Just recently in 2019, Safaricom officially released their FY2019, and as expected by some, the company reported tremendous growth in profits. M-Pesa estimated for 75 percent of the overall Safaricom growth in the year after registering a total of 19.2 percent jump year on year.
M-Pesa values for 31.2 percent of service incomes and according to Safaricom, the increase seen by M-Pesa is as a result of new businesses marked by the payments, savings and lending services(M-Shwari, Fuliza and KCB M-Pesa service) as well as money transfer services such as PayPal services that were launched about a year ago.
Out of the fresh 2.3 million customers that Safaricom has recently registered, 2.1 million are active M-Pesa customers and has 22.6 million active consumers.
The numbers considered together with the sort of profits generated from M-Pesa tells you how a lucrative business venture M-Pesa is. Being an M-Pesa agent will not just enable one to have made the most suitable choice but additionally opened up great possibilities as far as entrepreneurship in Kenya is concerned.
One may be having the thought of being an M-Pesa agent in the country, but they are lost on how to go about the entire registration process. Here is a step by step guide that will make it easy for anyone yearning to venture into the Safaricom M-Pesa business as an agent.
Would you like to be a business agent of the biggest mobile service provider in Kenya Safaricom? Read on to get the info.
What You Need to Get Started
For you To operate a Safaricom M-Pesa shop as an agent, one is expected to have a registered limited company in business in the country for at least 6 months and have at least 3 business outlets ready to provide MPESA services.
- The minimum investment for an MPESA shop outlet is Ksh100,000 shillings float.
- One will further need to provide Safaricom with valid business permits for every of the MPESA outlets in the country, VAT and tax certificates, ID’s, banking permit from a reputable commercial institution and the police clearance certificates.
- Now Fill in the M-Pesa agent/shop head office application form and also the M-Pesa agent store application form.
- Once the Mpesa application forms have been submitted and meet all the conditions, one will be given a till number that they will then use.
How to run the Day to Day Mpesa business
One can also decide to run the M-Pesa shop business by themselves or alternatively hire someone to run it for them who holds at least a KCSE certificate for your convenience.
The M-Pesa shops likewise need to be branded according to the set guidelines from Safaricom. The current day to day operations include;
- Depositing money into registered customers M-Pesa accounts
- Processing money withdrawals for registered M-Pesa clients
- Processing money withdrawals for non-registered M-Pesa customers
- Customer Education and enlightenment
- Compliance with Safaricom AML and KYC Policy
- Compliance with the Safaricom best business practices
- Branding of their Mpesa outlets as per provided guidelines
- Choose your favored MPESA outlet
You can operate your M-Pesa outlet in two ways;
This is the most advised mpesa outlet since you have to go through the entire process above and be enrolled as an agent.
As a sub-dealer
Working as a sub-dealer of Mpesa is much more affordable than officially registering as an Mpesa agent. Nonetheless, you will need to work under an authorized agent by purchasing their MPESA line and giving them a commission for working with their lines. For the sub-dealers, you simply need a float of Ksh20,000 to Ksh 40,000 shillings.
Volumes transacted: How much money can you earn from Mpesa shop?
The total amount you can earn in the M-Pesa business can be as low as only 4 shillings per successful transaction, this, consequently, means that your agent business must be able to draw many people in order for you to make any substantial money.
This further means that you need to set up your Mpesa shop in a busy area like Nairobi, Mombasa, Kisumu, or major towns where more people can come to your shop and access your M-Pesa services.
Advantages of aggregated M-Pesa lines
1. get Higher Commissions
with the aggregated M-Pesa lines you will receive the approved Safaricom split commissions rate which is 80 percent for you and then 20 percent for your principal.
2. Direct payment of commission earnings by Safaricom
You don’t need to wait on your principal partner to reimburse your commissions, you get it straight from Safaricom into your working mpesa account by the 1st of every new month, and there are also no delays in remittance of your commission.
3. Faster Conflict Resolutions means
in some circumstances there might be some problems with your principal or vice versa, for instance, some uncouth principals partners might feel their rented lines aren’t performing that well (getting lesser commissions than expected) and might even want to reclaim them without your consent, Such scenarios are quickly resolved if you are using an aggregated line unlike the non aggregated lines when the business arrangement is informal.
4. Float Management system
Aggregated Mpesa lines come with a float management system which enables you to efficiently manage your line/till, e.g., by presenting you an option to get money from super agents (the banks, certified super agents Mpesa shop outlets) by trading excess e-float with cash and vice versa.
Lipa Na M-PESA
This is a Swahili word simply translated to ‘Pay with M-PESA’ (mobile money service). The Lipa Na M-PESA service has two components, i.e., Paybill and Buy Goods.
The Pay Bill is for remote money payments, and the customer does not have to be physically present while paying for a service. The client has an official relationship with the given organization to whom they are making the payment and has an official “account number” that helps recognize the user. The customer enters a business number (known as pay bill number) for the entity which they are paying.
Buy goods and services option is mostly used for the retail purchase of goods and services. Both parties involved immediately confirm these vicinity payments via a text message. No relationship whatsoever between the buyer and the business or account number is needed.