Safaricom’s #ticker:SCOM M-Pesa users are now able to send money instantly to users of China’s largest payment and social media application, WeChat.
The partnership between Family Bank Limited and London-based financial technology firm SimbaPay will enable the 23,946,174 active M-Pesa users in Kenya to send money to over 1 billion active WeChat subscribers in China.
To send the money, Kenyans will use an M-Pesa Paybill number belonging to Family Bank and enter the phone number of the recipient in China as the account number. The recipient will then access the money on their mobile wallet.
The cost of the transactions will vary on a sliding scale. The cost of sending $80 (Sh8,198), for instance, will be Sh350.
“This is a huge milestone for us and our customers. We are glad to extend, more so to our SME customers, a solution that offers an instant, reliable, traceable and affordable channel to send money to their suppliers and business partners in China,” said Family Bank Chief Operations Officer Godfrey Kamau.
Besides M-Pesa, Family Bank customers will also send money to WeChat wallets through the bank’s PesaPap mobile banking application and USSD service.
Revenues from the transactions will be split between SimbaPay and Family Bank, but the partners could not disclose at what rates.
SimbaPay will update the foreign exchange rate daily.
Upon sending the money, customers will receive an instant notification informing them of the amount they will send in Kenya shillings, the foreign exchange rate and the Chinese Yuan amount which the recipient will get.
Majority of Kenya’s imports come from China and have been growing steadily over time, according to the Economic Survey 2018 report. Representing an increase of 15.8 per cent, imports in 2017 amounted to Sh390.6 billion. This is 2.8 times the value of United Arab Emirates (UAE) imports which were the second highest.
Financial institutions have been eager to position themselves as the preferred international money transfer partners to attract Kenyan traders.
In April, a deal between Safaricom, PayPal and TransferTo made it possible to move money between M-Pesa and 210 million active PayPal accounts globally in up to 25 international currencies.
Equity Bank also slashed most charges for its PayPal withdrawal service, with new tariffs that saw users pay as low as one per cent on large withdrawals made from the account.
Simba Pay plans to cash in on this trading ecosystem by easing money transfer for traders between China and Kenya. Bank SWIFT transactions usually require about three days.