In 2012, Safaricom partnered with Commercial Bank of Africa and unveiled M-shwari a product that runs off Mpesa and in the menu. M-shwari allows customers to save money that is in Mpesa to a bank account without actually going to the bank to open an account. Users are able to save money from as low as 1 shilling and credit of as low as 100 shillings. Money borrowed is transferred immediately to Mpesa account for withdrawal. Users could also access credit facilities using the facility. M-shwari currently has 11 million registered users with 5.8 million active users.
In the announcement of their Q3 financial results, the bank stated that the mobile lending service had boosted their net profit up 52.7% to Kshs. 3.9 Billion. The bank’s non-interest income for which M-Shwari fees are accounted for grew to Kshs. 4.19 Billion, which was a 70% growth. It will be interesting to see how the bank moves forward with the recent law requiring banks to cap their interest rates.
The success of M-Shwari has seen the bank seek to replicate the service in other markets within the region. In early August, CBA announced the launch of MoKash, a product that will be exclusive to registered MTN Subscribers. The solution allows users to borrow from as low as UGX 3,000 (Kshs. 90) to a maximum of UGX 1,000,000 (Kshs. 30000) at an interest rate of 9%. Subscribers can also save on the service, earning interest rates of between 2-5% on their deposits. The minimum amount one can deposit is UGX 50 (Kshs. 1). CBA also has a similar product in Tanzania called M-Pawa launched in collaboration with Vodacom.