Last month Safaricom launched M-Ledger, a free app that provides basic accounting tools for personal users and small businesses with an Android smartphone. M-Ledger records and categorises M-PESA transactions automatically, allows users to manually capture non-M-PESA transactions, and offers practical financial tracking tools. M-Ledger has already been well received and should help Safaricom to satisfy and retain its customers in Kenya’s increasingly competitive mobile money market. Moreover, with the growing importance of merchant payments to M-PESA, M-Ledger may increase the appeal of “Lipa na M-PESA” to new merchant segments and boost M-PESA transaction volumes.
M-Ledger is Safaricom’s first branded smartphone app and is already ranked second in the Safaricom Appstore, ahead of Facebook and Opera (and behind only WhatsApp). Although 58% of global mobile money operators now offer smartphone apps [1] as a channel for their core mobile money service, M-Ledger is one of the first operator-branded apps that tracks and builds on mobile money transaction data.
The app was developed by a local startup, Dynamic Data Systems, and highlights Safaricom’s ability to cultivate innovation within Kenya’s dynamic community of digital entrepreneurs. Dynamic Data Systems was the runner up from 18 companies incubated within Safaricom’s highly subscribed 2013 Appwiz Challenge. The app is completely free and it is rumoured that Safaricom has acquired the IP [2] from Dynamic Data Systems for the benefit of all its Android-based customers.
Although a minority of Safaricom customers own a smartphone and would be able to use M-Ledger, the proportion is rapidly growing. Smartphones represented 67% of the handsets sold by Safaricom in 2013 [3], the majority of which were almost certainly Android-based.
From Safaricom’s perspective, M-Ledger could be worthwhile purely for the increased satisfaction and loyalty benefits to customers that use it. However, there could be some interesting knock-on benefits and it will be interesting to see whether these materialise.
Firstly, the “Lipa na M-PESA” network already includes over 32,000 active merchants [4]; the addition of M-Ledger could boost Safaricom’s proposition for small retailers and encourage more of them to sign up. Kopo Kopo already offers a similar smartphone app and web tools (also including CRM tools and access to working capital loans) to some of Safaricom’s merchants. Kopo Kopo has shown that software tools to manage and track mobile money payments are an important part of the proposition for certain merchant segments, especially larger formal merchants. Similarly, M-Ledger could help persuade smaller merchants to accept M-PESA to simplify their accounting processes.
Secondly, this convenience factor may be enough to nudge some customer segments from cash to mobile money and boost transaction volumes. The ability to automatically track, categorise and summarise payments made through mobile money could be enough of an incentive for users who find managing their finances a painful process to make this shift.
M-Ledger at a glance
M-Ledger harnesses the digital potential of mobile money to automate record keeping and practical analytics. Unlike Kopo Kopo, M-Ledger isn’t directly integrated with the user’s M-PESA account. Instead, it scans the handset for SMS transaction notifications to create a database which is then backed up in the cloud. Key features include:
- PIN based secure access
- Automatic recording and classification of M-PESA transactions
- Ability to manually add non-M-PESA transactions, for example cash, making it a complete financial record keeping solution.
- Cloud based with mobile and web interfaces, with the ability to export to Excel or other formats for users who already have a financial record keeping system.
- Functionality to set budgets and monitor spending against these, similar to many other financial record keeping apps.
- A range of useful analytics and charting tools. For example, the ability to summarise monthly income and expenses by category and by recipient, to review average daily airtime spending, or to analyse the overall cost of M-PESA transaction fees.
[1] Preliminary results from the 2014 GSMA Mobile Money Adoption Survey
[2] See http://techmoran.com/safaricom-acquires-m-ledger-rebrands-safaricom-m-ledger/
[3] Source: http://www.humanipo.com/news/42985/kenyas-smartphone-penetration-at-67-safaricom/
Photo: From the Safaricom M-Ledger website.