M-PESA awaits UK forex nod

Safaricom’s plan to introduce an international money transfer service to tap diaspora remittances flowing into the country from United Kingdom is yet to be approved by both countries’ banking regulators.

The listed firm’s chief executive, Michael Joseph, revealed on Monday that though his company had technically made progress, both the Central Bank of Kenya and the Bank England were still thrashing out foreign exchange issues.

“The regulatory approval is still pending as we await forex approvals by banks from both countries,” said Mr Joseph.

But even as M-Pesa awaits going international, a planned money laundering audit by the Government is yet to take place nearly over a month after acting Finance minister, John Michuki instructed CBK to scrutinise the service.

“We have not received any information for an audit by CBK. I expect at some point they will come in and have a look [at our transaction records],” said Mr Joseph who also revealed that the mobile service provider was planning to acquire intellectual property rights currently owned by Vodafone plc by April this year.

The M-Pesa money transfer system, launched in March 2007, has seen its popularity with the unbanked population surge, causing jitters in the banking industry.

The average transaction value per person has dropped by 39 per cent, up from Sh3,800 in 2007 to Sh2,300 per transaction in December last year indicating that more people with less money are using the service more frequently.

“This proves that the service is reaching the unbanked who lack the money to open a traditional bank account,” he added.

Between March 2007 and September 2008, M-Pesa person to person transfers hit the Sh54 billion mark with December alone last year accounting for an additional Sh14 billion.