The Computer Society of Kenya

Since 1986


Technology-enabled financial services have been all the rage the past 12 months, raising impressive amounts of venture funding the world over. The opportunity is clear. The market – both local and pan African - is still open for the taking with several serious contenders.

The field consists of the telco-led, the bank-led, and the independents, each segment having chosen to start with peer to peer value movement and building agent networks to consolidate value.

The history of mobile money in Kenya is well known. Markets tend to do better with strong competition in the same weight class. I was pleasantly surprised to see that T-kash, the mobile money service by Telkom Kenya was getting a rejig.

The aborted merger with Airtel Kenya had sent the service to the dead pool, an anticlimax following its much-hyped entry into mobile financial services.

With the benefit of hindsight and learning from the global market, the strategy team at Telkom has gotten a few things right. The first is to understand that participating in the movement of value is critical to building a marketplace and eventual ecosystem.

Cash-in Cash-out should not be limited to one’s network of agents. The better the reach, the better the network effects, more so since I see a future where markets move away from transaction costs as a revenue driver on the platform side. Money wants to move ‘free’.

Building utility comes next. Nearly all fintechs have picked core services that they often discounted for users. Juxtapose this with the reality that most transactions are still in cash and that simple value preserving propositions would resonate well with the majority population.

You will see that the opportunity for value creation is still nascent. Playing well with others will pay dividends creating a flywheel of growth.

Telkom has many critical components available in-house, good regulator relationships and possibly better autonomy at the product level to differentiate T-kash.

Autonomy needs to go beyond the product design and build. This opportunity is best unshackled from historical baggage or thinking that will prevent the right partnerships from being realised or critical strategic moves adopted.

At the same time, using its pedigree to tap into 750 possible ecosystem relationships in the telecoms sector with peers and OTTs. It will go a long way to help break free from single market limitations and perchance allow for immersion into the venture capital dance.

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