Equity Group and Safaricom have announced an agreement to collaborate on new products and services. The pact will see them “build more inclusive financial products, explore regional synergies, simplify cash delivery between their agents and share technical knowledge to build a common approach to risks such as fraud and cyber-security.”
“At Safaricom, we are continuously driven to explore new ways to provide our customers with the best possible experience on our network,” said Safaricom CEO Bob Collymore.
YOU MAY ALSO READ: EGM Stresses Fintech Innovation for Financial Market
Equity Group chief executive James Mwangi and Mr Collymore said both companies will “work together to identify and deepen financial opportunities for Kenyans.”
The new pact signals a new business leaf for two of Kenya’s giant corporates whose longstanding love-hate relationship has triggered some of the fiercest corporate fallouts in the local corporate scene.
The M-Kesho dispute over revenue sharing played out in the public with bitter exchanges between the two firms seeing the service quietly fizzle out.
In 2015, Safaricom raised objection to the introduction of thin-Sim technology in Kenya championed by Equity Bank, saying the technology would compromise security of M-Pesa system exposing its money transfer service subscribers to fraud.
YOU MAY ALSO READ: CBN to Reintroduce Cashless Policy Nationwide, Says Emefiele
Experts said Monday the new pact provides opportunity for the two firms new massive revenue streams as the two banking and telecoms companies enjoy massive customer bases.
Equity Bank customers reached 13,460,350 at the end of last year according to the bank while Safaricom said its subscribers stood at 29.5 million at the end of last year.
“For consumers it could be a boon, as payment systems, loan platforms and transaction footprints increase dramatically,” said Deepak Dave, a risk management expert with Riverside Capital.
“The other side of the coin however, is that so much personal information and data is now in the hands of two organisations that already exhibit a degree of regulatory capture; who will be able to control so huge a beast in our tiny market?,” Mr Dave posed.
Safaricom pioneered commercial mobile money transfer globally through M-pesa while Equity Bank experienced rapid growth with its base in the lower stratum of the society.
Launched in March 2007, M-Pesa has over 27.8 million customers and 148,000 agency outlets countrywide.