Kenya’s Banks Unveil PesaLink to Compete with Investors’ Favourite BitPesa
Kenya’s banks are aiming to compete with M-Pesa mobile money transfer with their own product, PesaLink. Their plan is to undercut M-Pesa on fees, but they will only serve bank account holders at first.
Kenya Bankers Association, hereinafter KBA, has unveiled a new transfer product aiming to bypass the country’s ubiquitous use of the M-Pesa mobile service.
Dubbed PesaLink, it gives bank customers the ability to transfer money between banks in real time without the need of third parties, where M-Pesa is undoubtedly the major contender.
“PesaLink is the proof that the banking industry has embraced the technology revolution sweeping across the payment industry,” local news resource The Standard quotes KBA CEO Habil Olaka as saying.
M-Pesa has traditionally been extremely popular in Kenya, a country where banking penetration is far from comprehensive and cash is king.
PesaLink thus appeals to a limited section of society, given that M-Pesa does not require its users to have a bank account or even a smartphone.
However, plans are afoot to open up the service to unbanked customers, with the implication the process could end up cheaper than the “laborious and expensive process” of transferring funds between M-Pesa accounts, The Standard writes.
“What we assure is that the pricing will be more competitive compared to what we see in the market today as transaction fees,” Jeniffer Theuri, CEO of operator IPSL added.
M-Pesa ironically paved the way for the increasingly successful BitPesa alternative, which offers practically free P2P payments and remittances between phone users using Bitcoin.
The startup closed a $2.5 mln funding round in January, with an eye to taking its service to other African nations and further afield.