Vodacom will discontinue its M-Pesa mobile money service in South Africa from 30 June 2016.
“Vodacom’s decision is based on the fact that the business sustainability of M-Pesa is predicated on achieving a critical mass of users,” said Vodacom CEO Shameel Joosub.
“Based on our revised projections and high levels of financial inclusion in South Africa, there is little prospect of the M-Pesa product achieving this in its current format in the mid-term.”
Vodacom said M-Pesa continues to gain traction and growth in countries where financial inclusion is limited.
“Kenya and Tanzania are prime examples of this. This decision does not affect M-Pesa customers in Tanzania, Lesotho, Mozambique, and the DRC, where the product continues to grow.”
Joosub said Vodacom will mitigate any inconvenience to clients affected by the decision, and that their funds are safe and accessible.
“We remain of the opinion that opportunities exist in the financial services environment and we will continue to explore these.”