![Capturing market share will be a tall-order for Telkom, whose mobile money service T-Kash commands a mere 0.1% of the market according to CBK data. [Photo/ TechArena]](https://businesstoday.co.ke/wp-content/plugins/phastpress/phast.php/c2VydmljZT1pbWFnZXMmc3JjPWh0dHBzJTNBJTJGJTJGYnVzaW5lc3N0b2RheS5jby5rZSUyRndwLWNvbnRlbnQlMkZ1cGxvYWRzJTJGMjAyMiUyRjA2JTJGaW1hZ2VzLTIwMjItMDYtMjdUMTE0ODE3LjUwOC5qcGVnJmNhY2hlTWFya2VyPTE2NTYzMTk3NTAtMTcyNjEmdG9rZW49NmYxMDg0OGJlOGZmZWFiOA.q.jpeg "images - 2022-06-27T114817.508")
Telkom is set to venture into mobile lending as the loss-making telco turns to new revenue streams to achieve profitability. The service will be acccessible through the company’s T-Kash mobile money service.
With the new product, Telkom will be looking to compete with Safaricom, which has market-leading mobile lending products in M-Shwari, KCB M-Pesa and Fuliza. In a similar set up to Safaricom’s lending products, Telkom’s offering will be offered in partnership with a financial institution.
Following a successful test phase, Telkom is planning to officially roll out the product. Details of the loan service including interest rates and its official branding are yet to be made public.
Capturing market share will be a tall-order for Telkom, whose mobile money service T-Kash, as of February 2022, had a 0.1% market share – compared to 99% for Safaricom’s M-Pesa and 0.2% for Airtel Money by Airtel according to Central Bank of Kenya (CBK) data.
The data was tabled in Parliament as the MPs looked into claims by Safaricom’s rivals that the telco was abusing its dominance.
After shutting it down in 2017, Telkom Kenya relaunched T-Kash in 2018. The company is currently undertaking a restructuring of its operations after talks to merge with Airtel Kenya collapsed.
READ>>Safaricom Makes Changes to M-Pesa Statements
“From our interactive sessions with our customers, we have taken note that Kenyans appreciate mobile money solutions better when they keep on finding more reasons to attach value to their mobile wallets, whether they are sending money, paying for goods and services, saving, borrowing or trading,” Telkom disclosed in a statement.
“We continue to have these exploratory sessions that will inform and enhance the experience we offer our customers; we will be able to update once the new value proposition is ready for the market,” the company added.
The mobile loans space remains highly lucrative for Safaricom, whose products are offered in partnership with NCBA and KCB Banks.
In the six months to September 2021, for instance, Safaricom disbursed Ksh242.6 billion on the Fuliza overdraft facility.
The repayment versus disbursement rate stood at 99.0 percent with the value of repayments at Ksh240.2 billion. This impressive rate is down to the product being self-regularized as once a customer receives funds in their M-PESA wallets, the Fuliza balance is deducted.
KCB M-PESA disbursed Ksh22.9 billion over the same period. Customers managed to repay Ksh22.6 billion. M-Shwari, over the same period, disbursed Ksh43.4 billion, but only Ksh27.6 billion was repaid during the review period.
