Yesterday, Safaricom’s M-Pesa system took a two-hour nap, causing quite a stir across Kenya. With over 800,000 M-Pesa agents and payment merchants affected, it’s clear how much the country leans on this one mobile payment service.

The hiccup paused all M-Pesa transactions, throwing a spanner in the works for government services, daily revenue collections, deposits at sports betting sites in Kenya, and queues at businesses and institutions. Critical services like e-Citizen, supermarkets, fuel stations, hospitals, pharmacies, and schools collecting fees were left in the lurch. Even personal payments like withdrawals, transfers, airtime purchases, and bank to M-Pesa transactions were stuck.

Safaricom’s Silence

With a lion’s share of the market at 65%, Safaricom usually gives a heads-up for system maintenance. But this time, its 32 million M-Pesa users were caught off-guard. Safaricom’s response? A social media apology for the inconvenience.

e-Citizen, Kenya’s digital government services platform, which relies heavily on M-Pesa, was among the affected. It handles services like birth and death registration, driver’s licences, police clearance, business registration, and passport applications. The government’s recent move to centralize all payments through e-Citizen and M-Pesa only added to the chaos.

M-Pesa’s outage didn’t just inconvenience the public but also hit where it hurts – the government’s pocket. It’s the go-to for big taxpayers like betting firms and alcohol manufacturers to pay their dues to the Kenya Revenue Authority (KRA).

The timing couldn’t be worse – schools reopening, people travelling, and loads of transactions due for school fees and shopping. One customer shared a tale of cab woes: “I left the office to Kilimani using a cab, but since M-Pesa was down and I didn’t have cash, we agreed with the driver to hold my national ID until the system is restored. To make it worse, I couldn’t even purchase airtime from my app to seek help elsewhere.”

The downtime pushed people to turn to bank transfers, mobile banking apps, and ATMs. KCB Bank even issued a notice about delays in M-Pesa to bank services, asking for customers’ patience.

A Call for Interoperability

This incident shines a light on the need for mobile money interoperability. Central Bank of Kenya has been nudging for a break-up of Safaricom’s dominance to diversify payment options. Airtel and Telkom Kenya users can pay via Safaricom’s Lipa na M-Pesa, but the reverse isn’t true yet. 

Safaricom is yet to list “Lipa na Airtel Money” for its users.

The M-Pesa outage not only caused temporary inconvenience but also highlighted Kenya’s overreliance on a single service, sparking discussions on the need for a more robust and diverse mobile payment ecosystem.

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