Safaricom cuts Lipa na M-Pesa payments fee

Safaricom has lowered charges on payments service Lipa na M-Pesa, launched in June, by a third.

The service enables consumers to pay for goods and services using mobile money without incurring transaction charges.

The firm said it reduced the percentage commission traders pay based on the value of every transaction to 1 per cent from 1.5 per cent.

Safaricom chief executive Bob Collymore said the move was aimed at reducing the cost of doing business in the country.

The reduction is expected to pile pressure on the credit-card market where commissions stand at between three and five per cent. It by far becomes the cheapest means of making cashless transactions in the country.

“We have reduced the charges for Lipa na M-Pesa to cut the cost of doing business to traders who have registered for the service,” said Mr Collymore on the sidelines of the firm’s annual general meeting in Nairobi last Thursday.

With Lipa na M-Pesa shoppers can, for instance, use the mobile money platform to pay for goods at a supermarket till by the exact value of the item sold or service rendered.

This eliminates additional charges, a factor that has sustained cash as the most popular means of payments in the country. Shopkeepers, kiosks, salons and motor garage owners have to register their businesses with Safaricom and get a special till number to offer the service.

Traders use copies of their PIN certificates, identity card and trading licence to obtain a till number that customers use to pay for goods and services.