Vodacom Tanzania’s M-Pesa revenue grew by 8.4% to 357.1bn/- during the first quarter this year, the company’s preliminary consolidated financial results for the year ended 31 March, 2023 show.
“This marks a recovery in M-Pesa revenue to the levels last reported two years ago, prior to the disruption from the levies on mobile money. Accounting for the estimated impact of the levies in the first quarter, the underlying M-Pesa revenue growth for the year was 16.6%,” the company’s Managing Director Philip Besiimire said.
Besiimire added that the strong underlying performance reflects a good uptake of our new services in M-Pesa.
He said revenue from the company’s new growth areas including lending and insurance services, merchant payment service and international money transfer service increased by over 100%, with contribution to M-Pesa revenue more than doubling to exceed 25%.
“This helped offset thedecline in traditional M-Pesa revenue streams, such as peer-to-peer and cash out. In the fourth quarter,M-Pesa revenue grew 24.0%, reflecting an ongoing recovery and supported by the government’s decision to reduce the mobile money levies by 43% in July 2022, and a subsequent reduction to a maximum of 2,000/- in October 2022,” Besiimire said.
The Dar es Salaam Stock Exchange (DSE) company said that during the year it continued driving the uptake of our Songesha overdraft to both customers and agents.
“We served more than 4 million beneficiaries with this product, with over a trillion shillings in overdraft facilities issued. Our business is built on mutual trust and empowerment of our customers and business partners including financial empowerment,” Besiimire said.
During the first quarter, close to 100 000 agents benefitted from over 800bn/- issued in overdraft and term loans, representing an increase of almost three fold in funds issued.
“These loans support agents’ float availability and also supports their existing businesses.By enriching our M-Pesa ecosystem, we continued accelerating our payments services including ‘business to consumers’, ‘consumer to businesses’ and the merchant payment solution,” Besiimire said.
The payments options processed over 12trn/- in value during the quarter reflecting an increase of over 80%.
“We continued driving adoption of our merchant payment solution to reach over 150,000 merchants who accept payments through M-Pesa, under the ‘Lipa kwa simu’ service,” Besiimire added.
He said that in addition to generating revenue for the company, M-Pesa service is at the core of our purpose-led strategy to support a financial inclusion agenda, contributing positively to the country’s social-economic development, as well as individual customers and agents’ personal finances.
“It was encouraging that M-Pesa customers increased 1.4 million in the past twelve month to 8.2 million, up 20.0%. The total number of transactions grew 22.5% with value transacted increasing 13.3%, to an average of over 5.9trn/- per month.
“During the year, we also continued deepening financial inclusion through international money transfer services. We extended our money transfer services to some of the Southern African Development Community (SADC) countries capitalizing on the changes in the governing regulations. This extension partly contributed to the 24.2% growth in value of money sent through our IMT service,” he said.
The growth trends in M-Pesa performance indicators sets up a positive outlook for the future of M-Pesa business and hence the company’s contribution towards financial inclusion.
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