Telco giant, Safaricom PLC yesterday announced that it will be rolling out a new savings service on its M-Pesa platform. The new product dubbed Mali will allow M-Pesa users to invest as low as Ksh100 and earn a 10 percent annual interest nearly double the current interest that banks are paying on savings, which will accrue daily to allow subscribers to invest easily without exit restrictions, with the savings capped at Ksh 70,000.
Currently, Safaricom offers a savings product in partnership with NCBA through M-Shwari with those saving up to Ksh 20, 000 earning an annual interest of three percent, four percent for Ksh50, 000 and five percent above Ksh 50, 000.
Mali comes at a time where interest accrued on savings is reported to significantly dropped after legislation made changes to the banking law and did away with a clause that compelled banks to pay depositors at least 70 percent of base lending rate.
Kenyans are dying of curiosity as to what will become of this investment product, a combination of lending and wealth management services aimed at boost to earnings from financial services and encourage savings. In an official statement about the update on Mali, Safaricom has noted that the product will be relevant to its customers, but it will not comment on its future plans because it is premature to do so.
“Since we launched Mpesa 12 years ago, the service has continued to grow driven by our focus on the need of our customers. We explore different innovations from time to time, based on their performance and relevance to our customers, we evaluate which ones to launch.
“Mali is such one innovation that is in the early testing phase and still subject to ongoing engagement with relevant regulators for approval. It is therefore premature to comment on our future plans around the service and whether or when it will be available to all our customers,” read an update from Safaricom.
To qualify, one will be required to be a registered M-Pesa user for over three months. Savers will be able to invest money through USSD code *230 # or via a PayBill number. One can put in money and withdraw the next day, having earned something on the money since interest is calculated per day.
