The first 500 customers who were used to test M-PESA were supposed to use the new feature on their phones to pay loans, but they had other ideas. They started sending each other money using the mobile wallet, a small change that would eventually revolutionize financial transactions. Now, with M-PESA at 18, the platform has grown far beyond its original purpose, shaping how millions handle money daily.
Pauline Vaughn, who headed the team at Safaricom that rolled out M-PESA, recalled in an interview when the platform turned 15 in 2022 that this discovery by the team at the company was the moment they took a keener interest.
“We came up with the USP (Unique Selling Point) of ‘send money home’ and we took it to market in 2007,” she recalled.
They were familiar with a problem that was common in Kenya at the time: sending money upcountry was a headache. For many working in Nairobi, sending money to relatives was difficult especially if the relative did not have a bank account. It was also a laborious task and it was common for someone to make a journey of several hours to a bus stop to pick up a parcel of money.
“We saw an opportunity here of filling a big gap in the market,” Pauline recalled.
The first year was a race to create a critical mass of users – people who could send the money and at the same time, a big enough population that could receive it.
The initial target was to enroll 300,000 customers within the first year but one week after the launch, Michael Joseph, the founding Chief Executive Officer, asked the team to move the target to one million since 300,000 was too low.
The team did better than that and enrolled two million customers within the first year.
M-PESA, the platform developed with funding from the United Kingdom’s Department for International Development, Vodafone and executed by Sagentia Innovation will turn 18 in March. As we celebrate M-PESA at 18, it’s incredible to look back at how a simple idea of loan repayments evolved into Africa’s leading mobile money platform.
Watch the video to hear from Pauline on how M-PESA started.
