Mpesa is the leading mobile money service in Kenya, with over 60 million active customers and 200,000 agents across the country as of December 2022. The service enables users to send and receive money, pay bills, buy airtime, save, borrow, and transact online using their mobile phones.
Mpesa has become a vital part of the Kenyan economy, contributing to financial inclusion, social welfare, and economic growth.
If you are looking for a profitable and sustainable business opportunity in Kenya, becoming a Mpesa agent is a great option.
And who are Mpesa agents in Kenya you ask?
Mpesa agents are individuals or businesses that provide cash-in and cash-out services to Mpesa customers.
They also offer other services such as customer registration, balance inquiry, reversal requests, and assisted transfers.
As a Mpesa agent, you will earn commissions from Safaricom based on the number and value of transactions you perform.
The more transactions you make, the more money you will make. However, to succeed in this business, you need to meet certain requirements, follow certain procedures, and overcome certain challenges.
In this article, we will guide you on how to start a Mpesa agent shop in Kenya with ease.
Here are some of the topics that we will cover.
- Benefits of becoming a Mpesa agent
- Requirements and costs of starting a Mpesa agent shop
- Types and levels of Mpesa agents
- Process of applying and registering as a Mpesa agent
- Commissions and profits of running a Mpesa agent shop
- Tips and best practices for managing a Mpesa agent shop
- Challenges and risks of operating a Mpesa agent shop
1). Benefits of Becoming a Mpesa Agent
There are many benefits of becoming a Mpesa agent in Kenya. Some of them are:
- Growth and innovation: – you will be part of a growing and innovative industry that is transforming the lives of millions of Kenyans.
- Steady income: – you will have a steady source of income from the commissions you earn from each transaction.
- Customer loyalty: – you will have a loyal customer base that will keep coming back to your shop for convenience and security.
- Competitive edge: – you will have a competitive edge over other businesses that do not offer Mpesa services.
- You will have access to training and support from Safaricom and other partners.
- You will have opportunities to expand your business by offering other products and services related to Mpesa.
2). Requirements and Costs of Starting a Mpesa Agent Shop
To start a Mpesa agent shop in Kenya in 2023, you will need to meet the following requirements:
- You must have a registered limited company with at least 3 outlets ready to offer Mpesa services. You can also operate as a sub-agent under another registered agent.
- You must have a minimum float of Ksh. 100,000 per outlet. Float is the amount of money that you have available in your Mpesa account to facilitate transactions.
- Security: – you must have secure premises that meet the standards set by Safaricom.
- Have reliable power supply and internet connectivity for your point-of-sale devices.
- You must have qualified staff who can handle customer queries and transactions efficiently and professionally.
- You must comply with all the legal and regulatory requirements such as tax compliance, anti-money laundering, data protection, etc.
The costs of starting a Mpesa agent shop in Kenya in 2023 will vary depending on the size and location of your shop.
However, some of the common costs are:
- Point-of-sale device: You can also use your own smartphone or tablet with the Mpesa app installed.
The price will depend on the phone you are using.
- Branding materials: These are the items that you use to identify and promote your shop as a Mpesa agent.
They include signage, posters, stickers, banners, etc. The cost of branding materials is Ksh. 15,000 per outlet.
- Float: This is the amount of money that you need to have in your Mpesa account to facilitate transactions.
The minimum float required is Ksh. 100,000 per outlet.
- Rent: This is the amount of money that you pay to the landlord for the space that you use for your shop.
The rent will depend on the size and location of your shop, but it can range from Ksh. 10,000 to Ksh. 50,000 per month.
- Electricity: This is the amount of money that you pay for the power supply that you use for your shop.
The electricity bill will depend on the usage and tariff, but it can range from Ksh. 2,000 to Ksh. 10,000 per month.
- Internet: This is the amount of money that you pay for the internet connectivity that you use for your shop.
The internet bill will depend on the speed and data plan, but it can range from Ksh. 1,000 to Ksh. 5,000 per month.
- Staff: These are the people that you employ to run your shop.
You will need to pay them salaries, allowances, bonuses, etc.
The staff cost will depend on the number and qualification of your staff, but it can range from Ksh. 5,000 to Ksh. 30,000 per month.
These are the other expenses that you incur in running your shop such as stationery, transport, maintenance, security, etc.
The miscellaneous cost will depend on the nature and frequency of your expenses, but it can range from Ksh. 5,000 to Ksh. 20,000 per month.
Therefore, the total cost of starting a serious and potentially profitable Mpesa agent shop in Kenya in 2023 can range from Ksh. 200,000 to Ksh. 500,000 per outlet.
3). Types and Levels of Mpesa Agents
There are two types of Mpesa agents in Kenya: super-agents and sub-agents.
Super-agents are agents who have a direct contract with Safaricom and can operate multiple outlets across the country. They are also responsible for recruiting, managing, and supporting sub-agents under them.
Sub-agents are agents who have a contract with a super-agent and can operate one or more outlets within a specific region. They are also accountable to the super-agent for their performance and compliance.
As I see it, there are also four other levels of Mpesa agents in Kenya: bronze, silver, gold, and platinum.
Bronze agents are agents who have a minimum float of Ksh. 100,000 per outlet and can perform transactions up to Ksh. 70,000 per customer.
Silver agents are agents who have a minimum float of Ksh. 200,000 per outlet and can perform transactions up to Ksh. 100,000 per customer.
Gold agents are agents who have a minimum float of Ksh. 300,000 per outlet and can perform transactions up to Ksh. 150,000 per customer.
Platinum agents are agents who have a minimum float of Ksh. 500,000 per outlet and can perform transactions up to Ksh. 300,000 per customer.
The level of an agent determines the commission rate that they earn from each transaction.
Process of Applying and Registering as a Mpesa Agent
To apply and register as a Mpesa agent in Kenya in 2023, you will need to follow these steps:
- Visit the nearest Safaricom shop or authorized dealer and obtain an application form.
- Fill in the application form with your personal and business details.
- Attach the required documents such as copies of your ID card, PIN certificate, business registration certificate, bank statement, etc.
- Pay the required application fee per outlet at any Safaricom shop or authorized dealer.
- Submit the application form and the payment receipt to the Safaricom shop or authorized dealer.
- Wait for Safaricom to review your application and conduct due diligence on your business.
- If your application is approved, you will receive a notification from Safaricom inviting you to sign the contract.
- Pay the registration fee per outlet at any Safaricom shop or authorized dealer.
- Sign the contract and receive your point-of-sale device and branding materials from Safaricom.
- Activate your Mpesa account and load your float using your bank account or another Mpesa agent.
- Start offering Mpesa services to your customers and earning commissions.
The whole process of applying and registering as a Mpesa agent in Kenya in 2023 can take up to two months.
Commissions and Profits of Running a Mpesa Agent Shop
As a Mpesa agent in Kenya in 2023, you will earn commissions from Safaricom based on the number and value of transactions that you perform at your shop.
The commissions are paid monthly through your Mpesa account or bank account.
The commission rates vary depending on the type and level of agent that you are.
The table below shows the commission rates for different types of services offered by Mpesa agents as of December 2022:
Mpesa Agent Commission on Deposits
|💳 Deposit Bands (Ksh)||📊 Agent Commission (Ksh)|
|50 – 100||4|
|101 – 510||8|
|511 – 1,010||9|
|1,011 – 1,510||10|
|1,511 – 2,510||11|
|2,511 – 3,510||12|
|3,511 – 5,010||14|
|5,011 – 7,510||20|
|7,511 – 10,010||28|
|10,011 – 15,010||40|
|15,011 – 20,020||55|
|20,021 – 25,020||71|
|25,021 – 30,020||87|
|30,021 – 35,020||103|
|35,021 – 40,020||119|
|40,021 – 45,020||135|
|45,021 – 50,020||150|
|50,021 – 60,020||190|
|60,021 – 70,000||190|
Mpesa Agent Commission on Withdrawals
|💳 Transaction Band (Ksh)||📊 Commission, Registered Customers (Ksh)||📊 Commission, Unregistered Customers (Ksh)|
|10 – 49||N/A||N/A|
|50 – 100||5||N/A|
|101 – 500||8||8|
|501 – 1,000||10||10|
|1,001 – 1,500||12||12|
|1,501 – 2,500||15||15|
|2,501 – 3,500||20||20|
|3,501 – 5,000||25||25|
|5,001 – 7,500||30||30|
|7,501 – 10,000||35||35|
|15,001 – 20,000||60||60|
|20,001 – 25,000||65||65|
|25,001 – 30,000||70||70|
|40,001 – 45,000||150||NA|
|45,001 – 50,000||180||NA|
|50,001 – 70,000||200||NA|
Your monthly profit will depend on several factors such as:
- The type and level of agent that you are
- The number and value of transactions that you perform
- Location: – the location and size of your shop
- The competition and demand for Mpesa services in your area
- Quality: – the efficiency and quality of your service delivery
- The management and marketing of your shop
Therefore, it is important to plan and monitor your business performance regularly and make adjustments as needed to maximize your profit potential.
Tips and Best Practices of Managing a Mpesa Agent Shop
To manage a Mpesa agent shop in Kenya in 2023 successfully, you will need to follow these tips and best practices:
- Ensure that you have adequate float at all times to meet the customer demand for deposits and withdrawals.
- Reconcile your transactions daily and report any discrepancies or issues to Safaricom or your super-agent promptly.
- Keep your point-of-sale device and branding materials in good condition and visible to customers.
- Train your staff on how to use the device and handle customer queries and transactions efficiently and professionally.
- Maintain high standards of customer service and satisfaction by being courteous, friendly, and helpful.
- Observe security measures such as locking your safe, installing CCTV cameras, hiring guards, etc.
- Comply with all the legal and regulatory requirements such as tax compliance, anti-money laundering, data protection, etc.
- Keep track of your income and expenses and analyze your business performance regularly.
- Seek feedback from your customers and improve your service delivery accordingly.
- Promote your shop by advertising on social media, offering discounts or incentives, partnering with other businesses or organizations, etc.
Challenges and Risks of Operating a Mpesa Agent Shop
Operating a Mpesa agent shop in Kenya in 2023 also comes with some challenges and risks that you need to be aware of and prepared for. Some of them are:
- Fraud: This is when someone tries to deceive you or your customers to gain access to your money or information.
Fraud can take various forms such as phishing, identity theft, SIM swap, fake notes, etc.
- Theft: This is when someone steals your money or property by force or stealth.
Theft can occur from external sources such as robbers or internal sources such as staff or customers.
- Downtime: This is when your point-of-sale device or internet connectivity fails to work properly or at all.
Downtime can affect your ability to perform transactions and serve customers.
- Competition: This is when other Mpesa agents or businesses offer similar or better services than you in your area.
Competition can affect your customer base and income potential.
- Regulation: This is when the government or Safaricom changes the rules or policies that affect your business operations.
Regulation can affect your compliance and profitability.
To overcome these challenges and risks, you will need to take preventive and corrective measures such as:
- Educating yourself and your staff on how to detect and prevent fraud and theft.
- Reporting any suspicious or fraudulent activities to Safaricom or the authorities immediately.
- Securing your money and property with safes, locks, alarms, etc.
- Having backup plans for power supply and internet connectivity in case of downtime.
- Researching and understanding your market and customer needs and preferences.
- Differentiating and innovating your services to stand out from the competition.
- Keeping up to date with the latest regulations and complying with them accordingly.
Mpesa is a lucrative and rewarding business opportunity in Kenya that can help you achieve your financial goals.
However, to start and run a Mpesa agent shop successfully, you need to meet certain requirements, follow certain procedures, and overcome certain challenges.
We hope that this article has given you a clear and comprehensive guide on how to start a Mpesa agent shop in Kenya in 2023.
If you have any questions or comments, please feel free to contact us. We wish you all the best in your Mpesa journey! 😊