Safaricom’s M-Pesa is poised to become a part of the Pesalink network, potentially reshaping Kenya’s digital payment landscape. The move, proposed in collaboration with the Kenya Bankers Association (KBA) to the Central Bank of Kenya (CBK), aims to integrate M-Pesa, the country’s leading mobile money platform, into Pesalink, a national interbank payment system connecting 39 banks in Kenya.
This integration is anticipated to eliminate barriers between mobile wallets and traditional bank accounts, fostering a more unified payments environment in Kenya. By facilitating faster and smoother money transfers between mobile wallets and bank accounts, it could bridge the gap between mobile money services and the formal banking sector.
Currently, Pesalink, managed by Integrated Payment Services Limited (IPSL), enables instant bank-to-bank transfers but does not include mobile money services like M-Pesa. By joining the network, Safaricom would enable M-Pesa users to transact with any bank without requiring separate agreements between banks and mobile money providers.
This initiative aligns with CBK’s broader objective of enhancing payment processes and promoting financial inclusion through the Fast Payment System (FPS), which seeks to facilitate seamless cross-platform transactions.
The integration of M-Pesa into the Pesalink network could play a significant role in CBK’s planned FPS initiative, enabling instant and cost-effective transactions among various financial institutions, including commercial banks, SACCOs, and microfinance institutions.
One of the key advantages of this integration is the potential reduction in transaction costs. Sending money via M-Pesa is currently more expensive than transferring funds through traditional banks. Integrating M-Pesa with Pesalink would create a more interconnected financial ecosystem, allowing users to easily transfer money between mobile wallets and bank accounts and breaking down existing silos between these systems.
An integrated payments network could simplify payment acceptance for small businesses across different platforms, eliminating the need to maintain multiple wallets and representing a significant advancement in the payments sector in Kenya.