This stability reflects the fact that the financed phones provided by M-KOPA are seen as productive assets by their users, enabling them to generate income and participate in the digital economy,” the company stated confidently.
From a financial inclusion perspective in Africa, the achievements of M-KOPA are substantial. They show that startups can develop profitable business models while meeting the needs of the vast majority of adults in Africa’s emerging markets who rely on daily incomes rather than fixed salaries.
Patel attributes the company’s revenue growth and profitability to various factors, including improved pricing strategies, expansion into markets with stronger local currencies like South Africa, and the addition of 1 million underbanked individuals to their customer base in the last six months.
Furthermore, M-KOPA has been successful in maintaining high levels of customer compliance with payment plans, with an average of approximately 12 repayments per second. This reliability has allowed the company to offer higher-value products to its customers, such as microloans, electric bikes, data bundles, and health insurance, based on their repayment histories. Similar services are also offered by companies like MAX and Tugende.
“We are proud of the continuity of our business,” the former chief commercial officer stated. “It took us eight years to acquire our first million customers. Now, we have onboarded our fifth million in just over six months. The business is clearly on a very strong scale-up trajectory.”
The recent surge in user growth is attributed to M-KOPA’s strategic optimization of its sales and distribution network. Patel revealed that the fintech now boasts the largest direct sales force in sub-Saharan Africa, comprising over 30,000 active agents. These agents operate within their local communities, selling financed phones door-to-door and providing access to products that would otherwise be unattainable for many individuals.
In conclusion, M-KOPA’s success is a testament to the power of innovative fintech solutions in addressing the financial needs of underserved populations in Africa. With its strong growth trajectory and commitment to financial inclusion, M-KOPA is poised to continue making a positive impact on the lives of millions of people across the continent. M-KOPA, a leading fintech company in Africa, has highlighted the value of financed phones as productive assets that help everyday earners generate income and participate in the digital economy. The company’s statement emphasizes the significance of providing financial inclusion to the 90% of adults in Africa’s emerging markets who earn daily incomes.
The success of M-KOPA can be attributed to its improved pricing strategies, expansion into higher-value markets, and reaching an additional 1 million underbanked individuals in just the past six months. The company’s revenue growth and profitability have been driven by its customers’ ability to meet payment plans and the upselling of higher-value products such as microloans, electric bikes, data bundles, and health insurance.
M-KOPA’s rapid user growth has been supported by its extensive sales and distribution network, which includes over 30,000 active agents selling financed phones door-to-door in communities. The company’s move into smartphone assembly has also been a significant factor in boosting smartphone sales, with over 1.5 million X-Series branded smartphones sold since launching the assembly plant in Nairobi.
While M-KOPA initially started with selling solar power systems, it has since phased out this product line to focus on electric vehicles and smartphone assembly. The company’s financing model, which allows customers to make daily payments over time, helps them build credit histories and access credit in a region where traditional banking services are limited.
Backed by investors like Sumitomo and Standard Bank, M-KOPA raised $250 million last year, including $200 million in debt financing. The company’s success and growth trajectory position it as one of Africa’s largest fintechs by revenue, with a $400 million run rate.
Overall, M-KOPA’s journey underscores the importance of finding innovative ways to serve customers in emerging markets, combining cutting-edge technology with offline distribution and operational capabilities. The company’s focus on financial inclusion and providing access to credit for everyday earners highlights its commitment to driving economic empowerment in Africa.
