M-PESA, once the dominant mobile money platform in Kenya, is experiencing a decline in market share, now at 91%, while Airtel Money is gaining ground with increased affordability and strategic partnerships. Airtel Money has grown its market share to 8.9% within three years of operations. The competition extends beyond Kenya, as other mobile services also report user losses.
In Kenya’s competitive mobile money landscape, M-PESA, long regarded as the leading digital wallet, is witnessing a declining market share as Airtel Money makes significant inroads. Mobile money platforms have become essential in regions with limited banking access, particularly in Africa, where M-PESA was among the pioneers. However, recent reports indicate that M-PESA’s dominance has weakened, continuing a downward trend for the fifth consecutive quarter, with its market share decreasing by 2.3 percentage points to 91% in Q4 2024.
Conversely, Airtel Money has made noteworthy gains, increasing its market share from 7.6% to 8.9% within the same timeframe. This growth is impressive, especially considering Airtel Money began operations in Kenya only three years ago. The shift in market dynamics can primarily be attributed to Airtel Money’s more economical transaction fees, making it the preferred choice for many users. Notably, sending KES 1,000 ($7.7) through Airtel Money incurs a fee of KES 11 ($0.085), compared to M-PESA’s KES 13 ($0.093). Additionally, withdrawal fees on Airtel Money are slightly lower, further enhancing its appeal.
Airtel Money capitalizes on strategic partnerships, collaborating with nationwide supermarket chains like Naivas to bolster its deposit and withdrawal accessibility. While M-PESA boasts over 160,000 agents across Kenya, Airtel’s expanding network is gaining traction. The larger trend extends beyond Kenya, with other mobile money services across Africa, such as MTN’s MoMo PSB in Nigeria, encountering similar challenges, experiencing a loss of 2.5 million users in 2024.
Despite these challenges, M-PESA remains a formidable player in the Kenyan market, serving over 34 million customers and handling an impressive volume of transactions valued at approximately KES 40 trillion ($308.8 billion). Airtel Money, with around eight million registered users, is poised for growth as it continues to implement strategic initiatives to increase its market presence.
In conclusion, the mobile money landscape in Kenya is evolving, with Airtel Money emerging as a formidable competitor against M-PESA. While M-PESA retains a significant share of the market, it faces growing challenges that stem from Airtel Money’s strategic pricing and partnerships. This shift highlights a broader trend of competition in mobile payments across Africa, indicating that even established players must adapt to maintain their positions. The future of mobile money may hinge on affordability, accessibility, and strategic growth initiatives.
Original Source: www.techloy.com
