From Frustration To Flow: M-PESA And PayPal Streamline Global Payments for Kenyans

M-PESA, Safaricom’s mobile money platform, has significantly advanced its evolving global partnership with PayPal, a leading international online payment system. This strategic collaboration is poised to bridge the divide between Kenya’s local mobile money ecosystem and the global digital economy.

The foundation of this alliance was laid in April 2018, with Thunes (formerly TransferTo) providing the technological backbone that ensures seamless fund transfers between the two platforms. Initially, the service facilitated withdrawals from PayPal accounts into M-PESA wallets and enabled users to top up their PayPal accounts directly from M-PESA.

A key highlight of this enhanced partnership is its seamless interoperability. M-PESA users can now link their PayPal accounts to their M-PESA wallets, allowing for swift and convenient fund transfers in both directions. Conversely, users can also top up their PayPal accounts from M-PESA, empowering them to make international online purchases from merchants worldwide or send global payments through PayPal’s extensive network.

This means freelancers, online merchants, and individuals receiving payments from international clients via PayPal can efficiently withdraw those funds directly into their M-PESA wallets in Kenyan currency. This capability will provide immediate funds for many participants in Kenya’s burgeoning gig economy.

So far, anecdotal evidence shows a significant number of Kenyans reporting trouble using PayPal, especially when it comes to fund holds, account limitations, and unwarranted suspensions. PayPal often holds funds even when transactions generate from legitimate business.

Some users also find it challenging to provide the specific documentation PayPal requests for verification, such as utility bills for proof of address, especially if they pay for services differently (e.g., electricity units via M-PESA PayBill, or water as part of rent) or have P.O. Box addresses.

Some Kenyans on online forums add that PayPal’s security systems or fraud detection algorithms might disproportionately flag accounts originating from Kenya, leading to limitations, even for legitimate users. Crucially, the perceived lack of dedicated, localised PayPal support for Kenyan users has also been a point of frustration, making it difficult for individuals to resolve complex account issues.

This partnership aims to solve these problems, with a localised solution to send and receive money; it simplifies the process for Kenyans to engage in international e-commerce and receive cross-border payments.

The overarching goal is to make international transactions as straightforward and rapid as domestic M-PESA transactions, continually working to expedite processes that once took hours or even days.

While the service is currently focused on Safaricom’s M-PESA customers in Kenya, both Safaricom and PayPal have stated their intention to roll out this integrated service to other markets where M-PESA operates.

Feature Image Credits: Cointelegraph