February 28, 2025
Running an M-Pesa business is a profitable venture for many Kenyans, especially in areas where mobile money services are in high demand.
As an M-Pesa agent, your earnings come primarily from commissions on transactions, so increasing your transaction volume and optimizing your operations can directly impact your income.
Here’s a detailed guide on how to increase your M-Pesa commission through smart business practices, strategic location choices, and excellent customer service.
M-Pesa agents earn commissions on every transaction, which is deposited into their business bank accounts by Safaricom.
There are two main sources of commission:
Agents earn a commission based on a percentage of the withdrawal amount, with higher commissions on larger transactions.
Safaricom also pays agents a commission for each deposit transaction, though at a lower fixed rate than withdrawals.
Note: Understanding these commission structures allows you to tailor your approach to increase transaction volumes, boost commissions, and grow your overall income.
Below are viable strategies for increasing the commission from your M-Pesa Business:
Location is one of the biggest factors in determining your M-Pesa business’s success.
Setting up in a high-traffic area allows you to serve more customers, increasing both the volume of transactions and the commissions earned.
Ideal locations for setting up an M-Pesa business include:
These attract a steady flow of customers needing quick transactions for business or personal use.
Bus terminals and matatu stops have high foot traffic, often with customers looking to withdraw or deposit cash before traveling.
Locations near residential estates, malls, and commercial buildings are ideal for steady daily transactions.
Float is the cash balance that M-Pesa agents need to manage customer withdrawals and deposits effectively.
A low float means you may have to turn away customers, reducing your overall transaction volume and commission potential.
Here are tips for maintaining an optimal float:
Track your daily transaction volume to estimate the average float required. Increase float as demand grows.
Set up a system to replenish your float daily or even twice daily if needed, ensuring you never run out during peak times.
If you manage multiple outlets, monitor and balance floats across each location to keep all operations smooth.
Adding more services attracts customers to your shop, boosting foot traffic and transaction volume.
Here are some additional services you can offer to attract more customers:
Selling airtime alongside M-Pesa transactions can attract customers and offer an added revenue stream.
Enable customers to pay their water, electricity, and other bills via M-Pesa. Customers visiting for bill payments may also conduct other M-Pesa transactions.
Promote M-Pesa-related loan services like M-Shwari or Fuliza to draw more customers looking for financial services.
Good customer service is crucial for building customer loyalty and attracting repeat customers, especially in a competitive area with multiple M-Pesa agents.
Here’s how to ensure your M-pesa business stands out:
Greet customers warmly, serve them quickly, and handle their transactions with professionalism.
Ensure that transactions are processed accurately to avoid customer complaints, which can harm your reputation and reduce repeat visits.
A well-maintained and secure shop makes customers feel safe and welcome, encouraging them to return.
Since withdrawal commissions are higher for larger amounts, encouraging larger transactions can increase your earnings.
Here are some ideas for encouraging larger M-pesa transactions:
Encourage regular customers, especially business owners, to make larger, less frequent withdrawals instead of multiple small ones.
Explain the convenience and potential cost savings for them, as well as the benefit to your business.
Provide special assistance or quick service for customers who frequently make high-value withdrawals to encourage their loyalty.
Word-of-mouth and a positive reputation in your community can significantly impact your business.
When customers trust your shop, they are more likely to recommend it to others, increasing your transaction volume.
Here’s how to build a strong local reputation:
Clearly display your service charges to avoid misunderstandings and build trust.
Handle any issues professionally and offer quick resolutions to maintain good customer relationships.
Sponsor local events or engage in community service to make your business more visible and trusted.
If you have employees working at your M-Pesa shop, investing in their training can make a significant difference in your business’s performance.
Here’s what to focus on:
Train staff to greet and assist customers politely, as excellent service can bring more customers.
Ensure your staff is trained to handle transactions accurately, preventing costly errors and customer dissatisfaction.
Equip staff with the knowledge to handle common customer issues, like network failures or float issues, to ensure smooth service.
Marketing doesn’t have to be complex. Simple strategies can help increase your shop’s visibility and attract more customers:
Use clear, visible Safaricom-branded signs to make your M-Pesa shop easy to spot.
For shops in urban areas, using social media platforms like Facebook or WhatsApp to share your services can reach a wider audience.
Consider offering small incentives or discounts to frequent customers to encourage repeat business.
Tracking your transactions and commission earnings helps you identify trends, adjust your strategy, and optimize your business.
Here’s how to stay on top of your business performance:
Record the number of transactions and the total value to identify peak times and plan accordingly.
Review your monthly commissions and expenses to understand profitability and determine if you should scale up or adjust your business.
Use transaction data to fine-tune your float amount and reduce downtime.
Earnings vary based on transaction volume, but most agents earn between Ksh 20,000 and Ksh 100,000 per month.
High-traffic locations can generate higher earnings.
Yes, larger withdrawals yield higher commissions. However, deposits generally have a fixed commission regardless of transaction size.
Yes, running multiple outlets is a good way to boost income.
Each outlet requires its own float and setup, but more locations mean increased transaction volume and higher overall commissions.
The ideal float depends on your location and transaction volume. B
usy areas may require float levels above Ksh 200,000 to handle high customer demand, while lower-traffic locations may need less.
Running an M-Pesa business is rewarding, but maximizing your commission requires effective management, strategic location, and exceptional customer service.
By maintaining a sufficient float, encouraging larger transactions, and continuously analyzing business performance, you can increase your transaction volume and boost your earnings.
With these strategies, you’ll be well-positioned to grow your M-Pesa business and take advantage of Kenya’s thriving mobile money ecosystem.