MICROCAPITAL BRIEF: Commercial Bank of Africa, Vodacom Tanzania Launch Mobile Money Service “M-Pawa”

The Commercial Bank of Africa (CBA), a privately owned bank that operates in Kenya, Tanzania and Uganda, and Vodacom Tanzania, a subsidiary of UK-based telecommunications company Vodafone Group, recently announced the launch of a money mobile service called M-Pawa. This service will enable people “to save and borrow money on their mobile phone”[1]. Through the service, customers can save as little as TZS 1 (USD 0.0006) and borrow from CBA in amounts based on their savings history. M-Pawa will operate on the M-Pesa platform, a mobile-money system developed by Vodafone. In a statement attributed to Rene Meza, Vodacom Tanzania’s managing director, M-Pawa accounts are free of “ledger fees, limits on the frequency of withdrawals, minimum operating balances and charges on deposits and withdrawals from M-Pesa to M-Pawa account and vice versa”[1].

M-Pesa was launched in Kenya in 2007 and has since been replicated elsewhere in Africa and Asia. As of 2013, M-Pesa serves approximately 16 million clients through 79,000 agent outlets in Kenya, 5 million clients in Tanzania and a total of 5.6 million in South Africa, India and Mozambique.

CBA reported total assets of KES 75 billion (USD 880 million) as of December 2010. More recent financial information on the bank is not available. As of 2013, Vodafone reported revenue of GBP 44.4 billion (USD 69 billion), operating profit of GBP 12 billion (USD 18.7 billion) and a customer base of 403 million people in approximately 80 countries.

By Juan Blanco, Research Associate

About Vodafone Group

Vodafone Group, headquartered in London, is a British multinational telecommunications company. It operates in about 30 countries and has partner networks in approximately 50 additional countries. Vodafone Americas Foundation, a US-based subsidiary of Vodafone Group, funds projects that are deemed to be sustainable and that utilize the power of wireless technology to address social issues. As of 2013, Vodafone reported revenue of GBP 44.4 billion (USD 69 billion), operating profit of GBP 12 billion (USD 18.7 billion) and a customer base of 403 million people in approximately 80 countries.

About M-Pesa

M-Pesa is a mobile money service that was launched in Kenya in 2007 and has since been replicated elsewhere in Africa and Asia. The “M” stands for “mobile,” and “pesa” means “cash” in Swahili. Launched in Kenya by Safaricom Limited, a Kenya-based cellphone service provider, M-Pesa was developed by Vodafone Group Private Limited Corporation, a British mobile network operator. As of 2013, M-Pesa serves approximately 16 million clients through 79,000 agent outlets in Kenya, 5 million clients in Tanzania and a total of 5.6 million in South Africa, India and Mozambique.

Sources and Additional Resources

[1] Vodacom, “Vodacom and CBA launch revolutionary banking product,” 2014, https://www.vodacom.co.tz/aboutus/news

MicroCapital, March 25, 2014, First Access Purchases Data for Risk-Scoring Service from Cellular Network Provider Vodacom Tanzania

MicroCapital, April 17, 2013, African Guarantee Fund (AGF) Guarantees $3.5m in Loans from Commercial Bank of Africa, Investments & Mortgages Limited to SMEs in East Africa

MicroCapital, December 3, 2012, Safaricom, Vodafone, Commercial Bank of Africa Launch M-Shwari, Offering Mobile Access to Savings and Loans in Kenya

MicroCapital Universe Profile: M-Pesa

MicroCapital Universe Profile: Vodafone Group

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