Vodacom Group now processes more than US$400-billion (R7.4-trillion) in transaction value annually through its mobile wallet offerings.
The JSE-listed telecommunications group disclosed this figure on Wednesday in its latest trading update, for the quarter ended 30 June 2024. In the past year, it transacted $400.2-billion through its mobile money platforms, including Safaricom.
“Financial services is a clear strategic priority for the group and remains the largest component of ‘beyond mobile services’,” it said in reference to revenue that it generates outside its traditional mobile services business.
“I was particularly pleased with the growth of M-Pesa services that aim to deepen financial inclusion, such as loans, savings, international money transfer and merchant services,” said Vodacom Group CEO Shameel Joosub.
“Group financial services revenue of R3.3-billion was also supported by rapid local currency growth of 87% in Egypt, and strong growth in South Africa within our insurance and Airtime Advance segments,” he said.
Vodacom’s “super apps” – VodaPay, Vodafone Cash and M-Pesa – are key to the group’s plan to further its ambitions in financial services as they “integrate our own products and services with the best offerings from our partners”.
Vodacom said that in the quarter, it reported revenue growth of 1.5%, reaching R36.2-billion, although the top-line performance was impacted by “foreign exchange headwinds”.
Service revenue
Group service revenue climbed 10% on a normalised basis, above the medium-term target. South African service revenue grew by 1.8%.
Joosub said service revenue from Vodacom’s “beyond mobile services” category – which includes digital and financial services, fixed-line telecommunications, and internet of things services, contributed R6-billion to revenue in the quarter.
That equated to 20.8% of the group total, with Vodacom saying it is on track to reach its targeted contribution of 25-30% “over the medium term”.
Egypt was Vodacom’s best-performing operation in the quarter, with revenue rising 43.7% in local currency, well above inflation. In South Africa, prepaid performed well. Price increases also helped deliver a stronger performance.
“Supported by additional data allocations and good growth in smart devices, data traffic grew 31.3%, while ‘beyond mobile services’ increased by 6.3%, contributing R2.6-billion to South Africa’s service revenue of R15.3-billion. Having invested R1.9-billion in the quarter, we expect to invest around R11.5-billion of capital expenditure in the current financial year to further enhance customer experience,” Joosub said. – © 2024 NewsCentral Media
