20,000 Beautiful Ones

-

A Kenyan Company Offers Mpesa Agents.






Yankees Limited a Kenyan company and a Safaricom M-PESA Aggregator has partnered with Obuntu International Limited, an electronic platform provider, to offer a new M-PESA platform dabbed M-PESA Planet.

Yankees Limited with its M-PESA Planet platform plans to do what Wayne Huizenga did with the rental video industry in the USA, create a distinct brand within an existing industry; well the million dollar question is “will they succeed”?

The Jury is still out on that as it is still too early to pass judgment.

For one the company’s trial site at www.yankees.kbo.co.ke has had over 500 hits in 7 days and is a test bed for customer feedback and an insight for what would be M-PESA agents are looking for while the permanent online home www.yankees.co.ke is under construction based on the lessons learned on the trial site.

The Yankees M-PESA Planet Platform is poised to solve one of the major issues beguiling the mobile money space in Kenya by automatically and remotely monitoring E-Float levels and alerting the business owners/decision makers of the fact so that they may decide to borrow more float or to hold on and see the next type of transaction that takes place.

That will be good for the industry, real-time monitoring of float levels and access to float loans to assuage the situation, and that is over and above building a single brand name of Mpesa outlets, where float is always available.

On the other hand the real handle, which is keeping the jury breath baited is, is the MNO offering the service ready for that? An agent network manager rolling in thousand of new outlets per week and growing the agents network at an unprecedented rate, for that we all have to wait and see.

The Mpesa World


To better understand what is happening in the M-PESA world let us borrow and use some telecommunications analogies;

Tier-1 Agents 

 These are the banks and ATM operators, here issues of float, fake currencies or cash shortage are unheard off, and for arguments sake let us put the e-float requirement for tier-1 agents at greater than KES 500,000 (US$ 5,500)

Tier-2 Agents

These are middle level M-PESA agents, with e-float levels of between KES 50,000 and 500,000. Here you find forex bureaus, supermarkets etcetera, here the issue of cash or e-float shortage might crop up once in a while but is not much of a nuisance. Fake currencies also do not touch this lot.

Tier-3 Agents

These are the mom and pop shops and stalls that dot the whole country and are characterized with low e-float, typically below KES 50,000 and most of the time have a chronic and perennial shortage of cash or float. Incidents of fake currencies frauds wiping out a good chunk of the agents float are increasing.

With this categorization the reader realizes that the structure is pyramidal with Tier-1 occupying the apex and Tier-3 the most abundant occupying a huge portion of the bottom.

In the current M-PESA dispensation, terms like super agents, aggregators, agents and sub-agents have cropped up in trying to depict and put in perspective the different relationships between the three tiers.
Now that done, let us turn our attention to the typical M-PESA user (if there is such an oxymoron) and we note that out of the 16 million registered users barely 2 million of them have ever carried out a transaction at a Tier-1 outlet, bank and or ATM outlet, and that by itself gives you an idea why ATM based M-PESA frauds are so rampant, very few user have actually visited the ATM withdrawal menu in their phones.

And why is that, because most people normally transact below KES 3,000 which most Tier-3 agents are capable and comfortable to transact at and more so to the customer these are they kind of people, they are comfortable and in familiar surroundings.
In the Nairobi central business district, try and want to load KES 15,000 or more of e-float and most of the M-PESA outlets will tell you there is no float, this are Tier-3 operators and they are not used to transacting at that level, you will be forced to either load e-floats in lots of KES 3-4,000 at different outlets or go to a Tier 2 or 1 outlet.

The same applies to cashing out, here the threshold for cash at most Tier -3 agents is slightly higher, it is easy to get 10-15,000 in cash than it is to get the same amount of e-float from the same agent; a pointer of which direction the industry is leading too;
More customers want to buy e-float than to cash out, there are more uses of e-float (and growing) and it is relatively safer to move around with it that than liquid cash.
And more so this also acts as an indicator that agents are weary of finding themselves with worthless paper in their cash box at the end of the day since they have no means to ascertain if the notes they are receiving for their e-float is real or fake.

What Hails Thee My friend?                                                       


Well, the following are some of the bruises that M-PESA, currently in its early teens is suffering from;
  1. Shortage of float at Tier-3 outlets, which Safaricom believes tarnishes the good image of their stellar boy, M-PESA.
  2. Shortage of Cash, which inevitably the Tier-3 agents tell customers is shortage of float.
  3. Fake currency notes, inevitably also hitting Tier-3 agents, and bound to increase as they are easy pry for fake note fraudsters and the fact we are in an election year.
  4. Theft by servant, affecting all the tiers.
  5. High cost born by agents in getting extra float and cash from Tier-1 super agents.
  6. Tier-3 agents are easy prey for bureaucratic malpractices and big organizations manipulation.
  7. The young teenager is wearing clothes from another generation that is euphemism for the core technology of M-PESA is archaic.

Long Term Fears


There is real danger, that Safaricom in its quest to ensure Tier-3 agents have enough float, by increasing commission on higher value transaction and lining up as many banks as possible to offer float and cash loans, that the merchants will eventually seat down and do the math’s and realize that this whole M-PESA business is not offering them profits but making them poorer by eating into their other revenue streams.

As Alvin Toffler would put it, the solution needed is a 3rd wave solution not a smoke stack era one, you don’t bring a bricks and mortar solution in a situation needing a technological solution.

Safaricom in creating M-PESA brought technology in the form of “at a distance, the Greek meaning of Tele” to bear on a problem, then brought the bricks and mortar to cover the ground as the money did a fly through space.

The Long and Short of It: My Take                               


That said; let us get back to our topic of today, Yankees Limited M-PESA Planet platform and Safaricom Limited.

First to the M-PESA progenitor, Safaricom, structuring agents’ commissions to favor higher transaction tranches does not solve the problem of perennial float shortages at Tier-3 outlets; it just exacerbates it since the agents just earn less.

The solution could be to tell the customers that for a transaction of say KShs.30, 000 walk into a Tier-1 or Tier 2 outlet, in other words segment the agents’ outlets and give them appropriate branding identity.

But the mobile money business is not at Tier-1 or Tier-2 level business, those are beautiful hedge fences, it is at the cents and pennies coming in at the Tier-3 level, and here is where the most headaches that can affect a brand are most likely to occur.
Mass mobile money business is not an elitist kind of business, it is not iPhones or iPads, it is a simple no frills service offered through a simple mobile handset, period, it is a mass game not a niche outing.

And in Tier-3 agent’s network management is where the Yankees Limited with its M-PESA Planet Platform is trying to bring in a whiff of fresh breadth.

If I read them right this is what they are trying to do or will do:
  1. Get as many aggregated agents onboard and as quickly as possible.
  2. Create a brand within the M-PESA Tier-3 space where e-float is always available and fake money hits at agents outlets does not exists.
  3. Manage the whole undertaking electronically.
  4. Give the agents an e-letter to air their views, alert on rogue workers, advertise their other services and get insights on how to better their business.

But that cannot happen in a situation where the MNO processes 5 new applications per M-PESA Aggregator per month.
The threshold was a beautiful means for controlling agent roll out in the early formative stages of the brand, now the imperatives are different as dedicated by market needs and existing and envisaged usage of M-PESA e-float.

Can you imagine if you were an M-PESA Aggregator using currently available tools (mobile phones, email, and internet technologies) trying to build an agents network at the rate of 5 per month?
Add to that, the fact that the M-PESA is entering new phase, a phase where what can be bought or paid with M-PESA will.
The need for new business persons wanting to enter into the M-PESA agency business is growing day by day, and customers want M-PESA outlets within 100 meters from their homes. These new M-PESA outlets want and need to start with low e-float outlay and beef it up as they grow.

But with the new outlets processing caveat in place at the moment, the most likely outcome is surely disaster for any M-PESA Aggregator wishing to move in the direction of Yankees Limited.
Unless Yankees move dovetails with that of Safaricom, and that is what it is all about, end user satisfaction and helpful services to the merchants serving them, then we might see some tremendous growth in tier-3 M-PESA outlets, down to every conceivable premises including under trees, and then the language of money will be M-PESA.

And that is what the jury is still out deliberating on, the pros and cons of such a move of expanding Tier -3 agents outlets, since it can safely be said that any large player who wanted to be an M-PESA agent already is, what is left is to move it to the road side trader, just like prepaid airtime vouchers.

Thank You.

To View Yankees 20,000 beautiful benefits click here:

Comments as usual are welcome.

Comments

Post a Comment

Popular posts from this blog

How an M-PESA Agent Business Operates

-
here New to M-PESA or need just to know how an M-PESA Agency works .   First, what does an M-PESA Agent do? Receiving deposits from customers Offerings Withdrawals(give cash) to customers Registration of new customers Customer education. Compliance with Safaricom KYC (Know Your Customer) and AML (Anti Money Laundering) requirements. Branding their outlets to Safaricom requirements. Ensuring all required trading licenses for their premises are up to date.   Acquiring an M-PESA Agent Line (Till) To operate an M-PESA Business you must have a till with an Agent number. The M-PESA Agent Till operates or runs on a different type of SIM (Subscriber Identity Module Card) which is customized for the above functions of an agent though can also be used for other Safaricom services e.g. Calls and SMS. You can get this special M-PESA agent SIM from Safaricom or they can customize a new unused SIM placed on your phone using Over The...
Read more

Safaricom M-PESA Aggregator Model

-
M-PESA the Safaricom mobile money platform is five years old this year (2012). It provides a mobile e-wallet that is loaded with electronic money called Mpesa. Primarily Mpesa is bought at an M-PESA Agent outlet, where cash money is exchanged for Mpesa money. The spectacular success of Safaricom M-PESA offering, driven by a captive (“peculiar”) mobile service customer base, the roll out and management of M-PESA agents outlet coupled with a gamble in terms of strategy that was singularly executed, has given rise to a service that is the envy of many and the fear of even more. Success begets more success, leading to everyone wanting to jump into the M-PESA agents bandwagon, which in itself is expected and acceptable, the only downside being how to manage and ensure the good name of the service is maintained. The M-PESA agents ecosystem can be a quagmire to unravel for the uninitiated, and that is what this particular blog is all about. M-PESA Agents Classifica...
Read more

Mobile Money Systems Part 1

-
Electronic Payment Systems A few points are in order before we embark on our journey to the center of the earth. One , first mover advantage is unduly overrated and NOT for nothing, it does be store on the mover depending on the industry and the service offering at hand some tremendous power unless you squander it with always referring to your completion in all your public utterances  Case in point, Celtel in Kenya wasted its first mover advantage to Safaricom by constantly carrying out adverts with overt and covert reference to the competition, basically sharing their marketing budget with Safaricom and in the process creating a powerful sublime message in favor of their competitor: Lesson, black out your competition completely, don’t mention or acknowledge them in your customer communications or presence. Two , it is a believe among many professionals, that the spectacular success of Safaricom Mpesa is due to an alignment of the sun, moon and the stars, th...
Read more