For the better part of two decades, whether we liked it or not, and for the majority of Kenyan consumers and businesses, the default mode for making and receiving digital payments has been Safaricom’s M-PESA. M-PESA, in no uncertain terms, is critical infrastructure for all things digital payments across a myriad of use cases — with over 40 million users in Kenya and the diaspora, it has not merely dominated the landscape. It has become synonymous with it.

It seems somewhat ironic, therefore, that the recent fumbled launch of Safaricom’s My OneApp has invariably opened the door to alternative means of making digital payments for the approximately 8 to 10 million users of the now effectively defunct standalone M-PESA App who have struggled, through no fault of their own, to transition to what remains a still-flawed OneApp. For most Kenyan consumers, making payments or transferring money using M-PESA is like a conditioned reflex — we simply assume it to be the easiest and most accessible way to pay for anything and everything, and we reach for it automatically without a second thought.

The 8 Million M-PESA App Users Who Were Disrupted Are Probably Safaricom’s Most Commercially Important Customers

Before going further, there is something important to acknowledge about who exactly these 8 million former M-PESA App users actually are — because the raw number, or roughly 20 per cent of Safaricom’s total M-PESA user base, significantly understates their commercial and strategic importance to the business.

Think about it this way. To have been an active user of the standalone M-PESA App in the first place, you needed a smartphone, reasonable digital literacy, consistent access to either mobile data or Wi-Fi, and enough comfort with app-based interfaces to have chosen the app over the SIM Toolkit that the remaining 32-plus million M-PESA users continue to use perfectly happily. Each of those prerequisites is itself a proxy for socio-economic advancement. 

Smartphone ownership in Kenya has grown rapidly but remains concentrated in the upper and middle income segments. Data access costs money. App literacy correlates with education, professional exposure, and digital engagement. By definition, therefore, the former M-PESA App user base skews significantly toward Kenya’s most digitally progressive, most financially empowered, and most commercially active consumer segment.

Therefore, what this means in practice is that a relatively small portion of Safaricom’s 40 million M-PESA users almost certainly accounts for a disproportionately large share of transaction volumes, transaction values, and by extension M-PESA revenue. The 8 million app users are extremely likely to sit within that commercially critical minority. 

These are the customers who transact most frequently, who use the broadest range of M-PESA financial services including Ziidi Trader and M-Shwari, who pay the most bills, who make the most merchant payments, and who generate the most fee revenue for the platform. 

They are also, almost certainly, the most banked segment of Safaricom’s user base — meaning they have current accounts, mobile banking apps, bank cards, and the financial infrastructure to actually switch to alternatives when M-PESA becomes inaccessible to them. 

They are, as the past three weeks have demonstrated beyond any reasonable doubt, the most socially connected and most digitally vocal segment of Safaricom’s customers — which is precisely why the social media amplification of the OneApp crisis has been so loud, so sustained, and so commercially consequential relative to what the 20 per cent figure might suggest.

What this tells me is that Safaricom significantly underestimated — or simply did not adequately factor in — the specific profile, expectations, and switching capability of the very customers most affected by the OneApp transition. 

These were not passive, low-engagement users who would quietly wait for the app to be fixed. These were Safaricom’s most active, most demanding, most digitally enabled, and most alternatives-aware customers — the ones most likely to amplify problems loudly on social media, most likely to explore and adopt substitute payment channels during the disruption, and most likely to sustain changed payment behaviours even after the disruption is resolved. 

Designing a forced migration that did not adequately account for that specific segment’s characteristics and expectations is, in retrospect, perhaps the single most commercially consequential oversight of the entire OneApp episode.

OneApp’s Issues Made Many Of Us Start Seriously Using Digital Payment Alternatives

Since OneApp launched nearly three weeks ago with all sorts of problems for both local and diaspora users, it has essentially opened the door to alternatives that many of us would never have realistically considered before. I have already written about how I am now using Airtel Money via the My Airtel App to facilitate transactions to M-PESA users, till numbers, and paybills — and that has been a genuinely eye-opening experience in its own right. But the more interesting discovery has been a different one altogether.

The majority of Kenyan consumers will tell you that we typically use our bank accounts as a store of value from which we transfer funds to our mobile money wallets like M-PESA, and vice versa. From this perspective, what the OneApp crisis has done is push many of us to simply skip that step entirely. Due to the challenges OneApp users have experienced to date, many of us are now increasingly using our mobile banking apps and cards to make digital payments directly — and completely bypassing M-PESA in the process. 

This is genuinely fascinating to me, because for the longest time we have always known it is possible to pay for goods and services or send money using our bank cards and mobile banking apps. The perceived / real friction or unfamiliarity of doing so has simply meant that we have always defaulted to M-PESA in the vast majority of instances. OneApp’s failures have forced us to actually try the alternatives — and the alternatives, it turns out, work just fine.

The Frictionless Mobile Money Convenience Over Transaction Costs Trap

I have personally learned that it is just as easy to pay for utilities directly from my mobile banking app as it is using M-PESA. I have also been sending M-PESA payments directly to individuals and retailers using my mobile banking apps rather than the M-PESA interface. 

In other scenarios, I keep catching myself about to instinctively make a mobile money payment — using either Airtel Money or M-PESA — and simply using one of my bank cards instead. Initially, it felt genuinely strange and unnatural. But I am getting the hang of it the more I keep doing it, and the strangeness is fading faster than I expected.

The other thing I have realized — and this is perhaps the most practically significant epiphany of the past three weeks — is that every time we move funds from a bank account to a mobile money wallet, there are transaction fees. Then, there are the additional transaction fees for making the mobile money payment itself. 

In a nutshell, we have been paying a double toll, in many cases, without consciously registering it because the convenience of M-PESA made the cost feel invisible. When you start transacting directly from your banking app or card, that double toll simply disappears. There are genuine savings to be made when we bypass our mobile money wallets entirely for certain transaction types — and this, while quite obvious in hindsight, is one of the biggest and most overdue personal epiphanies of my recent experience.

When All Is Said & Done, OneApp Issues Notwithstanding, M-PESA Will Remain Dominant For Digital Payments In Kenya

Going forward, in the short to medium term, there is no real existential risk to M-PESA’s dominance given how deeply endemic it has become to all things digital payments in Kenya. M-PESA is so remarkably well entrenched in the Kenyan psyche — and in the country’s merchant payment infrastructure, agent network, and financial services ecosystem — that it is genuinely inconceivable that something which functions as the rails for all kinds of digital payments could be dislodged in any foreseeable future. It is also important to remember that the OneApp issues have directly affected only 8 million of M-PESA’s 40-plus million users — the rest continue to access M-PESA via the SIM Toolkit and the still-functioning MySafaricom App without interruption or inconvenience.

The thing that the OneApp episode changed is something subtler and more durable than market share. It has changed awareness — and specifically, it has changed the awareness of exactly the customers who are most capable of acting on that awareness. The digitally active, financially empowered, and highly banked consumers who make up the former M-PESA App user base now know, from direct personal experience, that mobile banking apps and cards can substitute for M-PESA in a wider range of everyday scenarios than they had previously realised — and in some of those scenarios, at lower cost. 

That shift in understanding, from abstract knowledge to lived experience, is not going to reverse itself when Safaricom fixes the app. Some users will return entirely to M-PESA. Many will maintain a more diversified payment behaviour than they had before. A number will find that the alternatives have earned a permanent place in how they think about paying for things.

Ultimately, OneApp’s failures have dramatically woken many of us up from our blissful M-PESA reverie. Given that the people who have been woken up are almost certainly the customers who matter most commercially to Safaricom — disproportionately active, disproportionately valuable, and disproportionately capable of switching — that awakening carries consequences that go considerably beyond a social media crisis or a broken app. It is a permanent shift in the payment awareness and payment behaviour of Safaricom’s most important customer segment. That is something that an app update alone will not reverse.