Safaricom, the largest telecommunications provider in Kenya has invested $4 million (Sh407 million) in M-Pesa, its fintech platform. This investment is in a bid to foster the cross-border expansion of the platform.
Safaricom facilitated this investment through its subsidiary company, Instaconnect Limited. The telco acquired the subsidiary in 2010. Before the acquisition, Instaconnect Limited provided content services.
M-Pesa is a fintech platform that customers leverage on to send and receive money, make bill payments, and also participate in international e-commerce. This is made possible through partnerships payment platforms like Western Union, PayPal, and AliExpress.
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Safaricom in its annual report said they expect the investment to yield activities that will impact positively on their business operations, whilst hoping that the impact will reflect on their results from now until March 2020.
In their words; “the company rolled out the international money transfer business through its 100% owned subsidiary, Instaconnect Limited. They injected additional capital by acquiring assets worth Sh397 million and a cash transfer of Sh10 million We expect that due to the above investment, there will be more activity that will have a positive impact on the reported results of a full year, to March 2020 from the operations of the new businesses.”
According to Safaricom, M-Pesa Global handled about Sh101 billion or a third of all cross-border remittances into Kenya in 2018.