Within five years of its launch, m pesa had 15 million customers, equivalent to 37. Mobilemoney becomes profitable only when it goes viral. This thesis investigates and defines business models that are in use by players along the value chain in. M pesa is not actually a company but a product offered by the kenyan telecommunications giant safaricom. M pesa has more than 21,000 agents managed by several hundred anms and million registered customers more than half the adult population. A mobile banking service that allows users to store and transfer money through their mobile phones. The companys services include temporary staffing, permanent placement, outsourcing, career transition. Unlike m pesa, whose primary business model required customers to transact via a mobile wallet linked to the safaricom simcard on their mobile phones, zoonas platform could be accessed via physical agents who would process transactions on behalf of consumers. Business model maturity estimated based on a ability to cover costs, b multiple players. From corporate social responsibility to business model. Mobile banking such as m pesa, kenya, a mobile phonebased. Faulu had difficulties in managing the manual proce dure and the. Jul, 2014 m pesa is not actually a company but a product offered by the kenyan telecommunications giant safaricom.
Key partners key activities value propositions key resources cost structure what value do we deliver to the customer. Business model innovations have reshaped entire industries and redistributed billions of dollars of value. How are they integrated with the rest of our business model. They have given financial markets and nonbanks an advantage over banks and significantly accelerated their growth over.
Describe your companys history if any or a startup information. Despite the growth that they can create, established corporations rarely create innovative. M pesa was originally introduced in kenya as an alternative way for the unbanked. This simple yet sophisticated technology took kenyas economy by storm. Business models, business strategy and innovation david j. Teece whenever a business enterprise is established, it either explicitly or implicitly employs a particular business model that describes the design or architecture of the value creation, delivery, and capture mechanisms it employs. Despite the hype, mkesho was not widely promoted after the launch. Depending on the business model and a type of business plan, you may need to include a description of the location and facilities. Business model assumed dramatic growth after launching m pesa in kenya, vodafone global services was restructured and a dedicated department was formed to manage the rollout of the platform in other countries. The importance of business models mike kubzansky, partner. From corporate social responsibility to business model innovation. Learnings from m pesa in kenya and tanzania for the unbanked. Pesa exists to promote the oilfield service and supply sector of the energy industry and provide our membership with opportunities to network, elevate issues critical to their businesses and effectively train their workforce. In a b2b business model, a business sells its product or service to another business.
Two authors have written this case study, each taking up one part of the story. International growth strategies for mpesa business adopted by. Feb 21, 2017 the m pesa mobile payment system was launched in kenya in 2007. Today, as it faces new challenges, it has 30 million users in 10 countries and three continents. In essence, m pesa is a persontoperson p2p money transfer system that allows individuals to make payments and send remittances. The business model canvas is a facilitated brainstorming exercise intended to generate ideas. Practitioners insight mpesa a success story of digital.
If you are creating a business model canvas for the first time and need ideas on what to include where, this template would be really useful with its detailed information on all important points of a business model. In fact, if we look back at the history of mobile payments were actually playing catch up. Because it takes agents a couple months to ramp up at their branch by attracting m pesa customers and convincing them to start transacting, the business model of m pesa incurs significant upfront costs and is one of the reasons many mobilemoney deployments fail in the early days. The reason for introducing this change was to encourage transfer within the m pesa registered base and maximize on the benefits of using m pesa in exchange for goods or services rendered. We provide a substantive definition of the business model, a collection of decisions enforced by the authority of the firm on its employees. There have been some notable successes, such as vodafone safaricoms m pesa in kenya. Financial services for the underbanked contributed. Mmoney channel distribution case tanzania vodacom tanzania. Most people and small businesses in emerging economies today do not fully participate in the formal financial system. Mpesa is a mobile phonebased money transfer, financing and microfinancing service, launched in 2007 by vodafone for safaricom and vodacom, the largest.
Mpesa and the rise of the global mobile money market. The categories in the model can be grouped as follows. While safaricom may not have had a fully articulated marketing plan. The b2b model generally means a longer sales cycle, but higher order value and more recurring purchases. We identify a small set of key ratios that differentiate banks business profiles and use a broader set of variables to provide a more complete characterisation of these profiles.
Model performance evaluation and scenario analysis mpesa. The m stands for mobile and pesa is swahili for money. Within five years of its launch, mpesa had 15 million customers, equivalent to 37. Mobile money offers a commercially viable business model for serving these potential customers, overcoming the constraint of distance by substituting cell phone. What makes a successful mobile money implementation. Issues, challenges and way forwards biswas sudipta rural development institute landesa 95s, block e, new alipore, kolkata700 053, west bengal, india. Since 2007, kenyas m pesa has revolutionized the way people spend, save, and send money. In 2014, equity bank announced it had received a license to become an mvno. Transforming millions of lives telecom circle the economic impact of mobile phones is a well talked about fact but the role of mobile phones in remittances and money circulation can be far greater. What bundles of products and services are we offering to each customer segment. To answer your questions simply, transaction fees a. Scheduled areas are areas identified by the fifth schedule of the constitution of india. Safaricom annual reports, full annual reports safaricom.
Mpesa is not the only mobile money service to be launched in africa, but it is the most successful. Sometimes the buyer is the end user, but often the buyer resells to the consumer. Strategyzer ag the makers of business model generation and strategyzer eativ ttributionshar op eativ rancisc. Unusual innovation from a corporate social responsibility project to business model innovation, coauthored with olivier furdelle, executiveinresidence at the insead social innovation centre, mpesa was not the first mobile money service launched in the world, but it was the most successful. Osterwalders business model canvas this is a visual tool for developing service or product delivery models. Comparative analysis of bkash limited assignment point. M pesa a success story of digital financial inclusion by njuguna ndungu, associate professor of economics, university of nairobi and former. M pesa was the first product of its kind to be introduced in kenya and is generally viewed as a successful implementation that should be used as a model for other developing countries.
Nov 20, 2014 as noted in my case study vodafone mpesa. Mmoney channel distribution case kenya safaricom m. Mmoney channel distribution case kenya safaricom mpesa. Enabling mobile money policies in kenya fostering a. Nov 26, 2015 the case sets the context for the relaunch of m pesa, and the reader is introduced to some of the limitations and challenges experienced by the company when trying to replicate a successful business model from one market to another, especially after an unsuccessful initial launch. The essence of the product is to enable transfer of emoney using a basic mobile phone. Pdf an analysis of mpesa use in international transactions. Financial services for the underbanked contributed by. The first is to define and characterise banks business models. Please little bit wait for product price updates and franchise update. Industry speculation was that the partnership fell apart over issues of control and the business model, and soon the two giants were battling once again. Prior to m pesa, mobile phone customers had engaged in trading prepaid airtime. Enabling mobile money policies in kenya fostering a digital financial revolution. M pesa business model canvas click to enlarge m pesa is a mobile phonebased money transfer, financing and microfinancing service, launched in 2007 by vodafone for safaricom and vodacom, the largest mobile network operators in kenya and tanzania.
Aug 12, 2015 most people probably dont think of kenya as an innovation and technology hub, but in 2007 it became the launching pad for mpesa, a transformative mobile phonebased platform for money transfer. Pesa,1996 the provisions of the panchayats extension to the scheduled areas act, 1996no. The study finally gives recommendations on m pesa use in international transactions. M pesa as a payments and money transfer platform was developed jointly by safaricom, a telco company, and the commercial bank of africa. For wellestablished organizations, the process may help sharpen the value proposition and lead to a better understanding of what clients i. The ultimate objective of bkash is to ensure access to a broader range of financial services for the people of bangladesh. There have been some notable successes, such as vodafone safaricoms mpesa in kenya. M pesa m for mobile, pesa is swahili for money is a mobile phonebased money transfer service, payments and microfinancing service, launched in 2007 by vodafone group plc and safaricom, the largest mobile network operator in kenya. The tool was developed specifically for the hydrological simulation programfortran hspf and the stormwater management model swmm models. Unusual innovation from a corporate social responsibility project to business model innovation, coauthored with olivier furdelle, executiveinresidence at the insead social innovation centre, m pesa was not the first mobile money service launched in the world, but it was the most successful. An analysis of business models for delivering mobile savings. The model performance evaluation and scenario analysis mpesa tool was developed to provide users with the ability to assess the performance with which models predict time series data e.
Different types of ecommerce business models explained. Click here to know more about safaricom annual reports. Traditional microfinance has limited reach, and solutions have been targeted towards poor farmers and small business owners completely overlooking others in need that represents 42% of the worlds population. Because it takes agents a couple months to ramp up at their branch by attracting mpesa customers and convincing them to start transacting, the business model of mpesa incurs significant upfront costs and is one of the reasons many mobilemoney deployments fail in the early days. It helps companies make strategic management decisions about their business activities by mapping potential tradeoffs. It has since expanded to tanzania, mozambique, drc, lesotho, ghana, egypt, afghanistan, south africa, india, romania, and albania. Other innovative services built on the original m pesa model include. The m pesa mobile payment system was launched in kenya in 2007. Most people probably dont think of kenya as an innovation and technology hub, but in 2007 it became the launching pad for m pesa, a transformative. M pesa offers clients a mobile wallet with the functionality to transfer money and pay bills. A comparative analysis both the companies started as mobile and dth recharge companies with epayment as their core business, however, one chose diversification and the. Which one of our customers problems are we helping to solve. The legal framework for microfinance had been approved by the parliament, but guidelines also had to be approved by. Internet waves and the digital business model patterns they gave rise to our chart many internet.