Masoko taps M-Pesa agents for success

Safaricom’s #ticker:SCOM e-commerce platform Masoko is leveraging its parent firm’s extensive mobile money agent network to beat logistical challenges faced by rival firms and to grow the platform’s reach.

A report released a fortnight ago on the state of the world’s mobile money industry by GSMA, a trade lobby for mobile network operators globally, noted that Masoko is using more than 160,000 M-Pesa agents as multiple delivery partners and pick-up stations.

The report says Masoko is now capable of delivering products to 45 out of 47 counties in Kenya.

“As in other developing countries, Safaricom’s main e-commerce challenge has been logistics. The MNO (mobile money operator) is addressing this by using its sizeable agent network as delivery and collection points, as well as multiple delivery partners,” the report says.

Masoko, by last November, a year after launch has about 120 active vendors and offers more than 30,000 products ranging from electronics to fresh goods.

Masoko Fresh is a segment that offers fruits, vegetables and dairy products.

The report adds that Masoko is also leveraging the reputation and trust of M-Pesa to offer flexible payment channels to customers and drive coverage.

"As a mobile money provider, Safaricom brings several unique strengths to the e-commerce domain. For example, while Safaricom offers several payment methods other than M-Pesa (such as VISA and MasterCard), Masoko does not offer the payment option of cash on delivery. As a payment service provider itself, Safaricom can guarantee payment for an order the moment it is placed — a core added value," says the report.

The telco, which is the region’s most profitable firm, is banking on diversification of revenue streams to sustain its future growth.

Safaricom earned Sh62.9 billion as revenue from M-Pesa business in financial year ended March 2018, being 28 percent of its total business revenue. It had 20.5 million 30-day active users.