Safaricom and Vodafone began piloting what became M-Pesa in Kenya with support from the UK Department for International Development (DFID) through the Financial Deepening Challenge Fund. The pilot tested whether people would trust a phone-based account, cash-in/cash-out agents, and SMS confirmations for transfers. Its early results helped justify taking the service nationwide.
Safaricom launched M-Pesa nationally in Kenya as a mobile phone-based money transfer service. Customers could deposit cash with a registered agent, send value by phone, and recipients could withdraw cash at another agent. This launch created a new payment channel for people who did not have bank accounts.
M-Pesa expanded quickly by recruiting retail agents (such as shops) to provide cash-in and cash-out services. Within about three months of launch, reports cited roughly 400 agents, already approaching the scale of Kenya’s traditional banking access points. Building this agent network helped M-Pesa move beyond a niche product toward a widely available service.
M-Pesa’s uptake beat Safaricom’s early expectations for customer growth. A University of Maryland-hosted assessment report notes the service aimed for 250,000 customers in its first year but reached that level within four months, and reached about one million registered users by the end of year one. This early surge signaled strong demand for safer, faster domestic transfers.
By 2009, M-Pesa was described as covering the majority of Kenya’s geographic areas and growing its agent base into the thousands. This mattered because the service depended on convenient cash-in/cash-out locations to work for everyday users. Wider coverage helped transform M-Pesa from an urban transfer tool into a broadly national payments network.
By August 2009, the same assessment report estimates over 7.7 million Kenyans had registered for M-Pesa—about 38% of the adult population at the time. This scale made M-Pesa difficult to ignore for banks, businesses, and policymakers. It also set the stage for M-Pesa to support additional uses beyond person-to-person transfers.
M-Pesa’s agent network expanded sharply, with the assessment report citing growth from about 7,000 agents in March 2009 to almost 17,000 by January 2010. A larger agent base reduced travel time and waiting for customers who needed cash services. This helped M-Pesa function as practical national infrastructure, not just a telecom add-on.
Safaricom reported that by 31 December 2010, M-Pesa had over 13.5 million customers and more than 23,000 agent outlets across Kenya. This showed sustained growth several years after launch, not just a one-time spike. The scale also supported wider bill payments and organizational use through M-Pesa’s Pay Bill functionality.
By the end of September 2011, reporting in Kenya cited M-Pesa with over 15 million subscribers and more than 20,500 agents. The same reporting linked this rapid growth to capacity strains, including service outages. These issues highlighted that M-Pesa was becoming critical infrastructure that needed stronger systems and oversight.
Kenya enacted the National Payment System Act (Cap. 491A), creating a clearer legal foundation for payment systems. The Act was assented to in December 2011 and published later that month in the Kenya Gazette. Although commencement came later, the law’s passage was an important step toward formal governance of rapidly growing digital payment services like M-Pesa.
Safaricom and Commercial Bank of Africa (CBA) launched M-Shwari, allowing M-Pesa users to save and borrow through their phones. This expanded M-Pesa’s role from payments into mobile banking-like services. It marked a shift toward deeper financial products built on top of the national mobile money network.
Safaricom launched Lipa na M-PESA in June 2013 to help businesses accept cashless payments directly from customers’ M-Pesa accounts. This supported everyday in-store purchases, not only transfers between people. The move helped push M-Pesa toward a broader national payments ecosystem used by both households and merchants.
M-Pesa roll-out and national expansion in Kenya (2007–2013)