M-PESA, Safaricom’s mobile money service, has declined for the fifth consecutive quarter, weighed down by increased interoperability and Airtel Money’s aggressive promotions, including transaction fee refunds as airtime.
M-PESA’s market share fell by 2.3 percentage points to 91% in Q4 2024 compared to Q3, while Airtel Money grew from 7.6% to 8.9% in the same period, according to data from the Communication Authority of Kenya (CA).
The sustained decline in M-PESA’s market share signals a shifting competitive landscape in Kenya’s mobile money ecosystem. Increased interoperability since 2022 has made it easier for customers to switch service providers. Airtel Money’s aggressive promotions, lower fees, and increased agent networks are drawing more customers.
The growth in Airtel Money’s customers suggests that many new mobile money accounts have joined its platform.
“Subscription to mobile money services grew by 4.1 percent to 42.3 million translating to a penetration rate of 82.1 percent during the reference period,” CA said in its sector report.
Airtel Money remains the more affordable option for transactions, which could also explain why it’s eating into M-PESA’s market. Sending KES 1,000 ($7.7) to other networks costs KES 11 (0.085) on Airtel Money, compared to M-PESA’s KES 13 ($0.093), while withdrawing the same amount costs KES 29 ($0.22) on Airtel Money—KES 2 less than M-PESA.
Airtel has also strengthened its agent network, partnering with supermarket chains like Naivas to host points where customers can deposit and withdraw cash. M-Pesa has over 160,000 agents spread across the country, giving it an edge over Airtel.
The Central Bank of Kenya (CBK) ‘s plan to implement agent interoperability, which would allow users to access mobile money services from any agent, regardless of the provider, remains unfulfilled despite the regulator’s commitment to roll it out by 2024.
With over 34 million customers, M-PESA is still the dominant mobile payments platform, handling over 30 billion transactions with an estimated KES40 trillion ($308.8 million). Airtel Money has an estimated eight million registered users.
CBK’s planned rollout of a new Fast Payment System (FPS), which will allow instant transactions across all financial institutions, including banks and payment service providers (PSPs), could further challenge M-Pesa’s dominance in the market.
