Walk with Me


Love this….great blog from my awesome cousin

Originally posted on msnjoki:

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I’ll start by making apologies for the long delay in posting this sequel. I think, for me, perseverance is much harder than taking the proverbial step to commence a thousand mile journey. Also Leonardo DiCaprio quote in the movie: Wolf of Wall Street best exemplifies me, he said ” the only thing standing between you and your goal is the bullshit* story you keep telling yourself as to why you cannot achieve it”.  Yes, my brain likes to play reruns of all the worst possible scenarios, am gradually learning to take control.

*Pardon him, he’s from America. The land where people think Africa is a country.
That said, let’s say am a girl on a mission. Yeah time to go buy a purple spandex. Why purple? Well cause green would be a bit cliché…

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East Africa’s first MVNO; Why Operators in the region should Care?

A mobile virtual network operator (MVNO) is a company that provides mobile phone service but does not have its own licensed frequency allocation of radio spectrum, nor does it necessarily have the entire infrastructure required to provide mobile telephone service.

 The idea of MVNO – that is, operators that don’t own their own communication infrastructure – has been in existence in other parts of the world for more than 10 years. http://www.standardmedia.co.ke/?articleID=2000109992&story_title=Opinion%3A+MVNOs+will+make+the+mobile+sector+more+vibrant&utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+PopularStandardDigitalNewsFeeds+(Popular+Standard+Digital+News+Feeds)

 The recent news on Equity Banks acquisition of a telecoms license, along with two other licensees has gotten the Kenyan market excited. I can’t help but get goose bumps at the idea.

 For starters its going to be the first MVNO launch in East Africa, and more importantly its led by a bank. Although in the traditional sense, Equity is among few banks in Kenya that does not operate like a bank. They truly understand their market and customer base. They came into their own, by redefining banking for the Kenyan market. Where it was the preserve of the few elites, Equity didn’t care what you did for a living to get you to open an account. If you were farmer, mechanic, shopkeeper, you are more than welcome to come in your gumboots. Lately they don’t even need you to come into the bank to acquire an account, just dial *247# and set up your own account

 We in the m-commerce space have witnessed the simmering discontent with Safaricom by Equity, especially in the wake of their failed marriage M-Kesho. At which I would presume Safaricom smiled all the way to the bank, daring Equity to do what they would. And they have( to which they say, get rid of the middle man)

 Equity’s story has always been one of triumph, first taking on the banking fraternity with their polished looks and elitist banking, to become the largest bank in East Africa, by virtue of customer numbers, and now taking on the largest operator in the region. It’s a rags- to- riches story that has put it firmly at the top to win the banking pie. I can’t help but root for them

 To put it into perspective for my Zim readers, Equity has more customers than Econet wireless. So you may be asking, what’s an MVNO anyhow, and how does it affect the price of cocoa in Ghana?  It would be akin to CABS  going head to head to launch it’s own network.

 What do MVNOs offer?

MVNOs normally try to leverage on one of the three strategic assets – Brand, Distribution or Existing Customer Base. The existing customer base can be non-mobile customer base that can be cross-leveraged for mobile services.

The partnership with Airtel is great; it helps Airtel utilize the excess capacity, with Equity riding on its expansive network. Airtel has failed to unseat customers from Safaricom, this just might be they thing to grow their revenues. This partnership is hugely valuable for Airtel because they can tap into a value pool that sits in a different market in order to increase the attractiveness of their services.

 Equity is targeting the retail payments space for which cash constitutes 70% of all payments and will be seeking to issue its own branded SIM- Cards. Their roll-out strategy and plan is well thought out, with an incredibly experienced team.

 Why do I have goose bumps you ask? Because not too long ago,I had this very conversation on what an MVNO could do for the Zimbabwe telecoms market. An agile player, unencumbered by the regulatory framework, the bureaucracy of operators, and with a keen ear on what customers want.

 Operators have much to learn from other businesses. Contrary to what operators believe, they don’t have all the answers. Other organisations often know a lot more than operators about mobile subscribers’ habits, and this is extremely valuable. Revenue growth will also increasingly come from products and services not in an operator’s core service portfolio.


Airtime Billing for Apps


Great piece from an old colleague…i got on http://www.iafrikan.com/2014/04/07/is-airtime-the-solution-to-kenyan-apps-payment-issues/ 

One of the largest obstacles in making money off mobile apps or in app purchases has been the lack of an easy payment solution for both the user and developer.

Credit cards have not taken off, and people generally wouldn’t trust a local apps company enough to link their debit cards. MPESA is cumbersome, with all the steps required to complete a transaction, and (at the time of writing) Safaricom wouldn’t open it up for people to integrate into.

There is however, one solution I am curious as to why it hasn’t been explored further: airtime.

Airtime has been a way of making payments for ringtones on mobile for close to a decade now and would be a great way to enable people make in app purchases.

Samsung, Nokia, Google, Blackberry, all major players in the device and mobile OS space have been in Nairobi carrying out hackathons and trying to get developers to build for their ecosystems. None of them has tried to tackle the question of enabling payment.

Of course, Safaricom is known for its rather grabby hands on any commerce transacted on its network. Often, on the lower end, the final payment to a Premium Rate Service Rate provider or its client is 25% of what was billed on the customer.

With the large players’ help – Nokia, Samsung, Google – it would be possible to negotiate a better deal for app developers akin to the 70/30 split that apple offers through the app store. Not only that, publisher such as Nation could sell mobile – Android and iOS – m- and e-papers that would have a daily or monthly subscription fee, and that would not require entering of credit card and debit card details. All I’d have to do is download the app from my app store and voila. I’d get a charge on my airtime whenever I launched the app and there was a new paper.

It has been done with great success. Companies such as Cellulant grew on selling ringtones and collecting payment by airtime. So why aren’t more people utilizing this?

This article originally appeared on Joel Macharia’s blog.


Ecocash Loans- Game changer ? Opportunity or Threat ? For whom

With the launch today of Ecocash Loans, following in quick succession from Ecocash Save accounts, Econet wireless has yet again read from the M-Pesa script to be the dominant financial services provider in Zimbabwe.

Ecocash is a bank, with the largest number of customers at 3.5M registered users. Having shaken up the financial services market and largely to reach the unbanked, sectors in the micro-finance are now jittery, they have come to eat their cake too. Banks have been the traditional threat to microfinance targeting the same customers, that today has changed with Ecocash entry into the lending space.

In the last 6 years M-Pesa has revolutionized banking in Kenya, with the 70,000 easy set-up branches( that you call agents) and with a total of 17m customers is the largest bank in Kenya and Africa. Holding close to a billion dollars in monthly deposits, controlling the mobile money transfer market with a billion dollars transferred monthly in peer to peer transfers, and in the last two years have diversified into savings and lendings.

The product that Ecocash Loan mirrors, M-Shwari had more than 350,000 micro loans within the first four months of launch. 60% of Kenya’s population is between 15-35years.To them, convenience is a lifestyle and mobile is their primary device; mobile banking has become a mass market service within a short period of time. 75% of M-shwari customers are 18-35years. They are accustomed to interacting with every sector of the economy via mobile.

How does this compare to Zimbabwe ?

With among highest penetration rates in the region, Zimbabwe’s telecom sector has outdone Kenya’s in terms of reach.

While I like to think that the markets are similar, a key difference in the markets has been the approach that Safaricom took. Safaricom opened up its platform massively for business. Any and every business can virtually acquire a mobile service within two to three weeks. The VAS aggregation space is regulated by the Communications Commission of Kenya(CCK) resulting in nearly 100-150 VAS players in the market, all service dynamic segments.

Mobile services are launched in a short window of time ( 2-3 month deployments) and virtually every sector is covered, from Financial services, Manufacturing, Transport, Education , Health, Agriculture, FCMG , just to name a few. Every sector of the economy has one or two key mobile services running with industry leaders having iterated two to three services in the last three – six years. You could call it a very hotly contested market. One in which Econet wireless failed to penetrate.

Cement Manufacturers have mobile codes for retail and distribution, pharmaceuticals have services for drug authentication, m-health, education services launched on SMS to manage training, Apps for agriculture, solutions for transport, mobile banking for Saccos and microfinance not just banks. Not to mention the digital content space with local content as a key commodity for players. We are talking mobile services that tell you when your cows should mate!

I postulate, and this is just my opinion, in their approach Safaricom, enabled innovation by allowing VAS aggregators access to services, and in that way, ensured their customer base was served in virtually every sector. Its not just allowing access, but maintaining a standard operating procedure for VAS players to connect services. Now it didn’t come easy, and Safaricom has often been described as a “market bully” or monopoly, but in my experience with Econet, they are a benevolent dictator. They set the terms, they set the rules, but the field is open for you to play. It’s your focus, commitment and  resourcefulness in this crowded market that will get you ahead, the operator doesn’t really get in the way of your business or the basic access to service.

 I think Safaricom has come to a place where they realize they don’t hold a monopoly on innovation, it will happen, they just need to get out of the way, take a cut, it contributes at least 4-6% of their total revenues.

Lets take look at Econet wireless.

Their story is an inspiration for Africa by many accounts having overcome the greatest of odds, from last entry in the market, to complete and utter dominance of the telecommunications sector in Zimbabwe. They are ruthlessly focused, efficient, and have managed to lead the sector in what I estimate this year will be billion dollar revenues.

Ecocash wallet has quickly acquired more customers than the total banked population in less than two years and their launch of service happens in a quick succession of 2-3 months for new products.

What about the market?

With no formal regulation of VAS/WASPA providers, it’s entirely up to the operator as to whom they choose to work with, how and when. No accurate processes to determine if and when they will take on new ventures, its more akin to lining up several suitors for one fat bride, there are always likely to be losers, never a level playing field. Not to be accused of ranting against Econet,  all operators work in this manner in Zimbabwe. Each has a preferred set or just one VAS player connected into their platform, reducing the likelihood of service deployments on unified shortcodes.

How many shortcodes for VAS ? Limited to News alerts, basic SMS subscriptions and operator dominated services. How many VAS players of note, less than 20. In fact the word aggregator, will get doors closed in your face.

How many microfinance institutions have mobile services ? your guess is as good as mine. How many manufacturers can deliver solutions for distribution within 2-3 months ? FMCG ? None. For a forward thinking market such as Zimbabwe why would top FMCG promotions run on WhatsApp! For banks the acquisition and roll-out of mobile banking solutions in the market has been painful, and often fragmented.

Econet will continue to dominate the market, that is not in doubt. In fact, we all want to be like Econet in a downturn economy like this. But will they deliver the level of innovation that this economy needs to break the downturn, not by a longshot. Innovation cannot be monopolized. If anything they should lead the call for a formalized VAS/WASP regulation, and open up the pipes. Not to be relegated into dumb pipes, but to participate in opening up opportunities that other business segments can build and grow on. Because their future depends on it.

They might read from the Safaricom script, but they are far from being a game changer for this market. The co-operative and collaborative model that impacts businesses and the economy at large does not exist.

Should Banks really fight Mobile Money?

Experts say no.

As most mobile money solutions gain traction in markets, banks have traditionally been on the opposing side. Report below from http://www.balancingact-africa.com/news/en/latest shows that theirs real benefit in coming together.

In the countries where mobile money has been particularly successful like Kenya, Uganda and Tanzania, the next unfolding wave of growth is payments integration. It sounds boring but it’s tying in merchants and banks to mobile money to allow more payments to be made more effectively. Russell Southwood talked to Arnold Sentuwa Luwugge and Gerald Begumisa of Yo Uganda about what it might mean.

Yo’s Arnold Sentuwa Luwugga describes the company as “developing technology and mobile solutions for businesses and NGOs”. It has developed its own custom software and has customers both in Uganda and in other African countries. It is currently working on rolling its services out in Burundi.

It facilitates payment between banks and the mobile money payment operators. It works for several banks including Opportunity Bank and EFC Bank to allow money to come out of and go into bank accounts. It also does bulk payments for both banks and NGOs.

The latter are increasingly delivering social payments and things like per diems to the phones of beneficiaries. Indeed USAID has initiative to migrate cash payments of this kind to digital:”Three NGOs have used it so far and we expect it to scale up this year. If you have 50 people at a workshop, you no longer need to carry cash to pay all the attendees. We make arrangements with the mobile operators to have agents nearby so the cash can be accessed easily.” The National Bureau of Standards can receive payments for inspection and certification through mobile payment.

It also does the more standard bill paying for things like utilities bills. The user can click a simple pay button to accept the amount displayed and a message is sent for confirmation back to the mobile and if accepted, payment is made to the merchant. Customers of ISPs like Smile can recharge their internet accounts in the same way and there is a direct link between Yo and Smile allowing the latter to see payments made in real-time.

Its online payment platform for transactions of this kind has 500 merchant accounts and its mobile one 50 customers but Sentuwa again sees rapid growth in 2014. A company called Multiplex runs street parking in Kampala and you can pay using Yo’s mobile wallet which is integrated into its payment system. It was launched last November and there have been thousands of transactions.

Sentuwa’s confidence about growth this year is partly based on the assumption that MTN will create a merchant framework similar to those operating in Kenya. Mobile money transactions in Uganda in 2013 were around US$6 billion but at present the vast majority of these transfers are person-to-person. The next wave of growth will be person to business (and vice-versa) payments:”We’re targeting quadrupling growth this year on that basis.”

Kenya which is slightly further ahead of the curve gives some indication of where things are going. Pesa Pesa has 10,000 merchant customers and it extends into pubs, shops, bars, restaurants and kiosks in the informal sector. It currently is handling US$1 million in transactions a month. Behaviours take time to change but the mobile phone is on its way to becoming Africa’s debit card.
See interview with Pesa Pesa on the link here:

East Africa leads the way in mobile payments

Got this from Kopo Kopo blog, haven’t blogged yet this year, thought its a good one to start of the new year.

East Africa is definitely leading the pay in the digital payments space, revolutionising how payments are done using mobile. As they say tell, an African that money is sitting on that little sim card, he’ll figure out how to get it out …..

2013 was definitely the year that global payments systems upped their stake in East Africa.