Nedbank, the financial services partner in Vodacom’s M-Pesa mobile payments initiative, says it is “disappointed” that the service hasn’t taken off as fast as it had hoped for but it remains committed to the venture and will introduce new products and streamlined services soon in an effort to grow the active user base.

Nedbank chief information officer Fred Swanepoel says there are about 1m M-Pesa users in SA, but he says the active user base is “disappointing”.

Vodacom has enjoyed far faster growth in M-Pesa in Tanzania. By the end of June, Vodacom in Tanzania had 3,6m M-Pesa customers, an increase of more than 120% over a year ago. M-Pesa contributes more than 70% of Vodacom Tanzania’s total data revenue and 12,3% of service revenue.

In Kenya, where M-Pesa was pioneered by Vodacom sister company Safaricom, the service continues to enjoy strong growth in a market where banking institutions are not well developed.

Despite the relatively poor performance of M-Pesa in SA, Swanepoel says Nedbank “remains committed” to its partnership with Vodacom and hints that there will soon be improvements to the service to help grow demand among consumers.

Anton de Wet, Nedbank’s managing executive for client engagement, says the bank plans to introduce a prepaid bank card linked to M-Pesa accounts “fairly soon”. It also plans to allow M-Pesa users to withdraw cash at any of its point-of-sale devices in retail stores. They can already use the bank’s ATMs to withdraw cash.

De Wet says he thinks M-Pesa hasn’t been as successful in SA as it has in other markets because of the country’s “regulatory framework”. But, he says, “you will see announcements fairly soon that make it easier to register for M-Pesa and also to bridge this completely virtual world of pure mobile with a linked prepaid bank card.”