VODACOM has launched an overdraft facility for its MPesa customers in partnership with TPB Bank.
The overdraft, attract 1.0 per cent a day, enables M-Pesa customers to make money transfers, remit bills, purchase from merchants or when they have insufficient funds in their accounts.
Vodacom’s Director of M-Commerce, Epimack Mbeteni said the idea of introduce ‘Songesha’ came after realizing M-Pesa sometime failed to complete a transaction due to shortage of funds.
“…Customers’ repeated transactional hurdles due to shortage of funds in their wallets inspired us to respond with an innovative solutionan overdraft facility that enables the customer to complete M-Pesa transactions that would have otherwise failed or postponed due to shortage of funds,” Mr Mbeteni said.
The soft ceremony to launch the overdraft facility dubbed ‘Songesha’ was held in Dar es Salaam yesterday. M-Pesa increased their market share by 40 per cent and advanced financial inclusion to over 9 million M-Pesa users who transact more than 4.1 trillion a month in the year ended March.
Once a customer signs up for ‘Songesha’ an overdraft will be automatically applied up on clients consent in the case where they do not have enough funds in their wallet to complete a transaction.
The borrowed amount will be automatically reimbursed upon customer’s deposit or receipt of funds in their M-Pesa wallets.
“The overdraft attracts an interest of 1.0 per cent per day with a facility term of up to 18 days and users can make one request at a time, as long as it is within their overdraw limit, which will be dependent on their M-Pesa transaction score,” he said.
TBP Bank will determine overdraft limit using algorithms based on M-Pesa transactions Mr Mbeteni said. TPB acting Chief Executive Officer (CEO), Mr Moses Manyatta said the bank focused on promoting digital finance by helping customers to cultivate the culture of saving.
“Our focus as a bank is promoting financial inclusion and empowering Tanzanians by helping them develop a saving culture and access to credit which is what Songesha is all about,” Mr Manyatta said.
Vodacom M-Pesa will automatically deduct the amount due from funds deposited or received into a user’s M-Pesa wallet until the overdraft is cleared in full.