Mobile money and data have emerged as the lifeline in revenue growth for African-focused telecoms operators Vodacom Group and Airtel Africa across markets characterized by stiff competition and challenging regulatory regimes.
The two telcos this week released full-year results for the year ended March 31 that show impressive growth in mobile money and data earnings amidst near-flat increase in voice revenue.
This year, the companies are apprehensive of the impact of the Covid-19, something that has forced Airtel Africa to extend the maturity of $254 million of debt facilities by an average of 18 months in order to improve its liquidity.
South Africa-based Vodacom rode on its investment in Kenya’s Safaricom, which is Africa’s second-biggest telco by market capitalization, to grow its revenues by 4.8 percent to $4.9 billion from $4.7 billion posted the previous year as the M-Pesa mobile money continued to gain traction in more markets.
The majority of Kenyans have also moved to mobile money transactions since the COVID 19 emergency measures were set to support cashless deals, new data shows.
The average number of daily mobile money transactions carried out by Kenyans since the measures were set has soared by 9.4 percent, according to CBK
On March 16, Central Bank of Kenya announced a set of measures to facilitate increased use of mobile money transactions instead of cash and this has seen a spike in the transactions.
The bands between Sh100 to 500 and Sh501 to 1000 recorded increased transaction volumes and values as the waiver of fees for up to Sh1000 encouraged more mobile money transactions. CBK also allowed telecommunication companies to extend the tariff threshold on mobile money transactions from an upper limit of Sh70000 to Sh150000 and lift the mobile money wallet limit to Sh300000.
The new Sh70,001 – 150,000 band recorded an average 5,457 transactions worth Sh564.48 million per day justifying the introduction of the higher limit for mobile money. The new band also recorded an increased average of 19,949 transactions per week worth an average of Sh339 million over the last two months.
Except for bands 10001- 35,000 and 35001-70000, all the other bands recorded increased volume and value of transactions. The average value of all mobile money transactions per day was however on the decline shedding 5.1 per cent to stand at a mean of Sh7.5 billion.
Transfers between banks and personal mobile wallets rose at a higher 22.2 per cent on a weekly basis since the waiver on fees to stand at Sh2.2 million in a day with an accompanying value of Ksh.17.4 billion.
“The increase in values of bank to e-wallet transfers may imply some success in the measure of reducing use of physical cash by Kenyans,” CBK said.
The emergency measures apply up to June 30 subject to review by the sector’s regulator.