Kenya’s largest telco Safaricom has applied for regulatory approval on three new financial products that will expand its product offerings. The telco has three incoming products, Bima, an insurance product, Mali (a mobile savings product that pays interest) and a unit trust investment product.
All the three will be built upon the company’s ubiquitous M-Pesa mobile money platform which controls nearly 99% of the market. If approved, Safaricom will have a variety of products in addition to loans, and paying for goods and services built on M-PESA.
“We are exploring the area of wealth management. We have developed a couple of products and we are seeking regulatory approval. Until the approval is given, we may not want to announce the specifics of the products,” said Safaricom CEO, Peter Ndegwa.
Safaricom’s ultimate plan is to expand M-PESA’s product offerings to become a financial services provider that can compete with traditional financial players like banks, insurance firms and fund managers.
We’ve already seen several reports surface about Mali, an investment product, which will reward M-PESA customers 10% interest on their savings. The pilot program kicked off December last year, and only allows users to save a maximum of Ksh 70,000.
Mali will compete with the government-backed M-Akiba retail bond which allows users to save as little as Ksh 3000 and earn 10% p.a tax-free.
Business Daily reports that the company will partner with an established fund trust manager already licensed by the Capital Markets Authority to launch its unit trust product.
Details on the unit trust product and insurance product dubbed Bima are still not known as of now.
Safaricom has several financial products built on M-PESA. Fuliza, an overdraft loan facility, was launched last year and the company’s recent financial report reveals it processes an average of six loans per second.