Safaricom And KBA Advocate for Pesalink as Kenya’s Unified Digital Payment System
Kenya’s digital payment ecosystem is poised for a major shift as Safaricom and the Kenya Bankers Association (KBA) propose leveraging Pesalink as the country’s primary fast payment system (FPS). Instead of creating a new infrastructure or depending on multiple private switches, the two entities advocate for enhancing Pesalink’s existing framework to unify Kenya’s fragmented payment landscape.
Operated by Integrated Payment Services Limited (IPSL), a fintech arm of KBA, Pesalink currently facilitates transactions worth $8.5 billion (KES 1.1 trillion). The proposed transition would make Pesalink the backbone of a seamless, interoperable system connecting banks, mobile money platforms like M-Pesa, SACCOs, and fintechs under a unified structure.
The Case for Pesalink
Safaricom and KBA argue that Kenya’s digital payments network remains disjointed, with financial institutions relying on individual agreements to connect with mobile money services. This patchwork approach results in inconsistent service quality, higher transaction fees, and inefficiencies. Establishing Pesalink as the industry-led FPS could eliminate silos, ensuring a more integrated and cost-effective payment framework.
Building a new FPS from the ground up would be both costly and time-consuming—projected to require at least $200 million (KES 25.9 billion) and four years to complete. Enhancing Pesalink’s capacity, on the other hand, would be a faster and more affordable alternative.
However, for Pesalink to serve as a national FPS, it would require significant upgrades, including the ability to process 6,000 transactions per second, enhance risk management, and improve security protocols to handle increased transaction volumes.
Alternative Models and Regulatory Considerations
While the Colombian model, which relies on multiple private switches managed by the Central Bank, is an alternative, Safaricom and KBA caution that such a structure may lead to governance challenges and inconsistent service quality. A single, industry-led FPS built on Pesalink would ensure a more streamlined regulatory environment and reduce operational inefficiencies.
According to Ali Hussein Kassim, Chairman of the Association of FinTechs in Kenya, a unified payment system would strengthen Kenya’s digital economy, making transactions cheaper, faster, and more accessible across different platforms.
What’s Next?
Although the Central Bank of Kenya (CBK) has yet to approve the proposal, momentum is building around the idea. If greenlit, Pesalink would undergo a comprehensive upgrade, positioning it as a next-generation payment system capable of supporting real-time cross-platform transactions between banks, mobile money operators, and fintech services.
This initiative could mark a transformative moment for Kenya’s financial sector, fostering greater financial inclusion and enhancing the efficiency of digital transactions nationwide.
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