I think this will be dictated by my estimate of 8 - 12M or so safaricom subscribers. If the bulk of that lot is not using the Mpesa product (frequently), then indeed it's the end of the road for the agents. Edwin From: kictanet-bounces+eonchari=lynxbits.com@lists.kictanet.or.ke [mailto:kictanet-bounces+eonchari=lynxbits.com@lists.kictanet.or.ke] On Behalf Of Francis.Hook@gmail.com Sent: Wednesday, September 08, 2010 3:32 PM To: Edwin Cc: KICTAnet ICT Policy Discussions Subject: [kictanet] Might M-Kesho sound the death knell for (some) M-Pesa Agents? 1 - Equity Bank has abt 4.5 million customers. 2 - Lets wager that abt 70-80% are Safaricom subscribers...(3.15 - 3.6 million) and possibly 80% of those use M-Pesa (wild guess) 3 - A Study conducted in late 2009 (http://technology.cgap.org/2009/09/08/understanding-what-drives-profits-for -agents-m-pesa/) examined the factors that make an M-Pesa agent make a profit...as well as the challenges faced by such agents (which would most times lead them to say "hakuna float"). 4 - As M-Pesa agents have become more pervasive, their profit margins have become thinner owing to competition (incl ATMs, super markets, etc). This is part of the premise of M-Kesho - to allow such agents to make revenue from additional services like insurance... 5 - M-Kesho essentially removes the need to have CASH transactions - either sending or receiving. However, to the operator the transaction fee still accrues, and to the bank, the deposits remain somewhat stable. If anything, for corporate users of M-Pesa (KQ, KPLC, etc) they can know have their accounts credited directly - no need to use an M-Pesa agent to load cash onto phone and then pay KPLC, Kenya Airways, etc. 6 - Thinking of the three or so million Equity Bank Customers who are M-Pesa users....will they EVER need to use an M-Pesa agent? before the routine to send cash was ...a) draw cash from ATM/Branch b)go to M-Pesa Agent c) send money - and vice versa to receive (go to mpesa agent, get cash, spend/deposit cash) - ergo M-Pesa agent has a role. Of course I admit, such account holders can still withdraw from their accounts using M-Kesho and get cash from an M-Pesa Agent (but I think this would be really really rare). Will M-Kesho see some rationalisation in the number and size(type) of agents? Admittedly some of the more established agents can evolve into FOSAs for Equity (and other banks), but I think at the grassroots there might be a negative impact. My two cents... Francis No virus found in this incoming message. Checked by AVG - www.avg.com Version: 8.5.441 / Virus Database: 271.1.1/3121 - Release Date: 09/08/10 06:07:00