CASE STUDY
Safaricom PLC is a listed Kenyan mobile network operator headquartered at Safaricom House in Nairobi , Kenya . It is the largest telecommunications service provider in Kenya and one of the most profitable companies in the East and Central Africa region . The telecommunications service provider offers mobile telephony , mobile money transfer , consumer electronics , e-commerce , cloud computing , data , music streaming and fibre optic services . It is most renowned as the home of MPESA , a mobile banking SMS-based service that facilitates mobile phone-based money transfer service , payments and micro-financing service , launched in 2007 by Vodafone Group PLC and Safaricom . Intelligent CIO Africa recently sat down with George Njuguna , Director , Information Technology ( CIO ) at Safaricom PLC to find out how the company has continued on the innovation path and is pioneering a digital first agenda in all its operations in East and Central Africa .
In the past year , what have been the main IT achievements of your organisation ?
One of the big ones is a product called Fuliza . This is a very interesting proposition and we got an award for it at AfricaCom in November 2019 .
Mobile money is very big here . It ’ s the largest volume of digital transactions in the country , with about 24 million active users per month .
We did some research and realised a lot of customers paid when they didn ’ t have money but the transactions were able to complete within a day or two of the transactions . This was because they actually did have money and about 54 % of them would be completed . But if somebody was at a store they wouldn ’ t be able to do it , so we then created the first digital overdraft .
So if you go to pay at a supermarket and your bill is about 50 bucks and you only have five bucks in your mobile wallet when you go to make the transaction , it realises you don ’ t have enough money and it presents an overdraft to you .
The moment you accept the transaction is completed so you don ’ t have to go back and move money from your bank account . You
AS MUCH AS THERE ’ S THE CONTENT PROVIDERS , IF PEOPLE DON ’ T HAVE A WAY TO ACCESS THIS JUST BECAUSE OF THE PHONES , THEN WE ’ VE NOT YET ADDRESSED THE INCLUSION ISSUE IN TERMS OF DIGITAL . don ’ t have to go and deposit money at an agent for it to move to your digital wallet , it ’ s automatically completed .
We usually talk about how the first overdraft was done in Scotland in 1708 and it took the industry close to 300 years to do the first truly digital overdraft . We call it contextual lending . We lent about US $ 1.4 billion within the first nine months of launching it .
Can you tell us about another successful project ?
In Kenya , 90 % of the telecommunications market is actually prepaid . You buy a bundle with data and minutes and you buy it ahead of time . Some people literally buy four or five bundles a day because they live from day-to-day . The way the product is propositioned is you would buy a bundle for a particular amount .
We switched this in October last year following an initiative by our Commercial and DevOps teams , based on insights derived from the behaviour seen in the way people buy milk . When Kenyans go to buy milk , they go to a supermarket and there ’ s the milk that ’ s already packaged but also they can go with a container and they just put in the milk they want and pay for it so they determine the amount .
We transferred this to a digital process , where a customer can put in something as low as one cent or two cents and whatever they have we present back to them the mobile resources ( Voice or Data ) they can afford . This was highly disruptive and was the first time it has been done in the world . This was us saying ‘ let ’ s give you a choice .’ With this system you decide whether you want it for data or for voice . It was a really big change and it ’ s been very good because we ’ ve seen about 40 % of our customers , especially on the data side , move to this . It helped to drive our customer promise of being simple , transparent and honest .
Are there any current projects you are working on ?
We are now working on something interesting with Google on Device Financing .
We have 4G coverage in about 75 % to 80 % of our country but we still only have fewer than 4 million customers against a base of 35 million who have smartphones . We realised the big challenge is actually they can ’ t afford a smartphone . So to address this we ’ ve partnered with a phone manufacturer , partnered with Google , then we ’ ve built an www . intelligentcio . com INTELLIGENTCIO
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