Safaricom introduces overdrafts to M-Pesa
The Kenyan telecommunications company, Safaricom, has announced an additional feature introduced to M-Pesa.
Customers will now be able to send money or pay using the mobile money transfer service with insufficient balances following the launch of overdrafts.
The company successfully trialled the overdraft service in November last year, leading to the launch to 24.2mn customers.
The facility has been named Fuliza or Okoa M-Pesa, and will enable users to borrow up to Sh50,000 (US$490.71). The overdraft carries interest of 0.5% per day.
Safaricom partnered with the Kenya Commercial Bank (KCB) and the Commercial Bank of Africa (CBA) in order to establish the service, Kahawa Tungu reported.
The banks will use algorithms based on transactions on M-Pesa to determine each user’s overdraft limit.
The overdraft service can be used as often as required, as long as customers stay within their granted limit.
Mobile commerce transactions hit 526.9mn in Kenta between July and September of last year, totalling Sh1.55trn (US$15.2bn), whilst person-to-person transactions hit Sh2trn (US$19.7bn) during the review period.
The nation’s mobile phone penetration currently sits at 100.1%, with some Kenyans owning more than one sim card.