M-Shwari is a digital savings and loan product by Safaricom in Kenya. This is the company that was responsible for building M-Pesa. They were tremendously successful with that payment product, and have started moving out of the P2P (peer to peer) market into value added financial services. In order to access the M-Shwari product, you need to deposit some money into your M-Pesa account. They will then offer you a loan based on the amount you have deposited, and a few other variables I imagine. You receive the loan on your phone and repay it on your phone. It’s an end to end mobile financial service. It’s the kind of innovation we’ve come to expect from Safaricom. Below are the stats from a recent CGAP post.
It’s been a huge success. Some of the numbers I find truly amazing are the non-performing loans at 2.2%. That is incredible. 20.6 million loans since launch is another great one. Congrats to Safricom for rolling out another great product. However, despite the good numbers, a closer look shows that they are trending down in loans and deposits. While they were first to market, and there are now several other players there, including JUMO, who are trying to compete with the mighty behemoth. I think Safaricom will remain the number one player for some time to come, but the new start-ups on the scene are going to pick out niches within their segments and start attacking. That’s the way it always works. It will be fun to watch it unfold.