Vodacom Plans to Extend Mobile Money to New African Markets
Vodacom Group Ltd. sees the expansion of mobile-banking services into new markets in sub-Saharan Africa as a top priority following a shareholder vote to rubber stamp its purchase of a 35 percent stake in Safaricom Ltd., Kenya’s biggest company.
“We will use Safaricom to enter other markets where neither Vodacom nor Safaricom are,” Chief Executive Officer Shameel Joosub said in an interview at the wireless carrier’s annual general meeting in Johannesburg on Tuesday. The two businesses have a combined 30 million mobile-banking customers, giving them “a very sizeable platform on the continent,” he said.
Vodacom’s purchase of the Safaricom stake from U.K. parent company Vodafone Group Plc gives the South African company access to the fast-growing M-Pesa platform, which processed about 891 billion shillings ($8.5 billion) in the three months through March, or more than 75 percent of Kenya’s total, according to the country’s telecommunications regulator. Entering markets through its financial services platform will allow Vodacom to access countries without having to purchase a voice license, Joosub said.
Mobile-payments are popular in countries with limited banking infrastructure, which includes much of sub-Saharan Africa outside of South Africa, Vodacom’s biggest market. The company plans to compete with the mobile-money services of Millicom International Cellular SA, Bharti Airtel Ltd. and Orange SA, Joosub said.
Vodacom shares declined 0.6 percent to 173.34 rand as of 2:26 p.m. in Johannesburg, valuing the company at 258 billion rand ($20 billion). Almost all shareholders voted in favor of the Safaricom deal at the Tuesday meeting. Read more at: https://www.bloomberg.com/news/articles/2017-07-18/vodacom-ceo-plans-to-...
By Loni Prinsloo and Janice Kew