Oral East AfricaSafaricom is leaning on digital transformation to cover for falling incomes on less call time and regulatory caps have ham struck its revenue growth.
Telco giant and financial service provider Safaricom has announced plans to launch Safaricom Hook’ a product targeting youngsters with customized product range by leveraging big data technology even as it Mpesa super app registered 9.6 million downloads.
Safaricom Hook targeting Kenyans as young as 10 years seeks to enable Gen Z to maximize their online potential and enjoy a digital lifestyle by facilitating smartphone access, flexible data and voice offers, and availing loyalty rewards and delight offers.
Profit decline
Cuts in mobile termination rates, huge capex spending in Ethiopia and falling call time saw Safaricom net profits decline 18.7 percent to Kes42.6 billion for the full year ending March 2024.
In August 2022 Kenyan regulators slashed MTR rates from 99 cents to 58 cents, and a further cut to 41 cents last year blew a Kes1.2 billion hole in the company earnings.
Safaricom spent Kes46.2 billion setting up operation in Ethiopia that dragged down the giant telcos’ profits.
The giant telco saw strong growth in Kenya where it controls 65 percent market share, with a huge chunk of the revenue drawing from its flagship mobile money M-Pesa and its transaction ecosystem.
At Kes140 billion, M-Pesa revenues now make up 43 percent of mobile money incomes dwarfing voice, mobile data and messaging incomes for the telco.
Please call me
Voice revenue declined by 1.7 percent YoY to Kes79.51 billion reflecting the global impact of the downward trend of voice service.
The company now says its focus is leveraging tech capabilities to drive market share into Kenya’s youthful democratic dividend to retain customers in the MPesa ecosystem to cross sale payments, transaction and financial service solutions while allowing other retailers to plug in to users in line with their preferences.
Safaricom is one of the biggest data repository besides the government. With AI the company has a chance of understanding their customers, make more sense of transactions and get feedback from product use.
The company knows how much money you have on M-PESA, how you are transacting and recently showed it has capabilities to geolocate customers and send targeted messaging, when it helped the Red Cross disseminate flood warnings.
For Safaricom, AI presents the capacity to handle its massive network optimally with use of advancements such as the Zuri chatbot which has helped it tackle fraud and customer complaints more effectively.
The deployment of AI is however likely to spark concerns over data protection but in a previous media interview Safaricom Head of Big Data & Analytics Charlotte Kepadisa said the biggest responsibility for the company is to ensure that even as we process in this data, we do it so, we do it responsibly, but we do it also to benefit the customer.
