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M-Pesa upgrade to ease payment of electricity bills

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Safaricom is upgrading M-Pesa to a new platform that will make it easier for users to pay bills. FILE

Safaricom has begun upgrading M-Pesa to a new platform that will enable users make instant payments of their bills.

Under the new system, whose processing capacity is expected to increase, clients will settle post-paid electricity bills, insurance premiums and bank payments in real-time.

The mobile firm has already awarded Chinese telecoms giant Huawei the tender to migrate M-Pesa to the new platform, an exercise that it said would take 18 months to complete. The first phase is expected to be completed by the fourth quarter of the year.

The upgrade is set to save customers inconveniences like electricity disconnection that occur as the current platform reconciles transactions.

It takes 48 hours for payments made to Kenya Power to reflect on the electricity distributor’s systems while those made to the National Hospital Insurance Fund take 76 hours.

The current M-Pesa platform handles between 200 to 300 transactions per second but after migration the rate is set to go up 10 times.

“Safaricom will migrate to this new platform in about 18 months’ time and planning has already begun for the extremely complicated process,” said former Safaricom chief executive and director of mobile money at Vodafone Group Services Michael Joseph.

“The new platform is designed to be more efficient and therefore costs less to operate and maintain.”

Mr Joseph, however, did not say whether the firm would pass on the savings made to consumers but said that the decision would have to be reached by Vodafone and Safaricom who absorb the operating costs.

He said the new platform would come with additional functions that allow for M-Pesa’s integration with those of other vendors in banking, micro-insurance and retail sectors, especially supermarkets.

That means shoppers would use the mobile money platform to pay for their goods instantly at the till, opening a window for the service to effectively compete with credit cards.

M-Pesa is also eyeing bulk government payments such as pensions and salaries paid to beneficiaries in remote locations.

As part of the upgrade, its servers will be relocated to Kenya from Germany, a move that is expected to improve the reliability of the mobile money transfer and cut overheads.

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