29 Fuliza

For solving mobile customers’ short-term cash needs

The Safaricom team stumbled onto an odd fact: More than half of customers using its mobile money-transfer service, M-Pesa, couldn’t finish a banking transaction because they didn’t have enough money in their account. Yet most of them had the funds a few days later.

To keep transactions flowing—without the hassle of loan applications—Safaricom launched Fuliza. Named for the Swahili word meaning “continuously flowing,” it’s billed as Kenya’s first and only mobile overdraft service. The premise is simple enough: If a customer is running short, the service gives the option of borrowing money to cover the balance, for a small fee. They then have a month to pay back the microloan.

Developing the product was far more complex. The 50-person project team spanned Safaricom, Commercial Bank of Africa, KCB Group and Huawei. “At the project’s start, some of our biggest challenges involved just agreeing on stakeholders’ roles and responsibilities,” says Wanja Murekio, senior program manager, Safaricom, Nairobi, Kenya.

Because M-Pesa supports multiple services—paying bills, sending money, buying goods—Fuliza had to be tested against each of those features. When technical difficulties upended the schedule, the team kept it agile.

“Because we had a defined governance structure and a steering committee with members from each partner, it was easy for us to ask for decisions and approvals at our weekly meetings,” Murekio says.

Within three months of Fuliza’s 2019 launch, more than 4 million customers had tapped some US$170 million in credit. Safaricom has since announced plans to extend the service into six more African countries.

Some fintech firms have made moves to court customers with similar nobody’s-finances-are-perfect offerings. In late 2019, the online bank Chime launched SpotMe, which allows users to overdraw their accounts by up to US$100 with no fee. And several banks, including Stash, N26 and Varo, now allow customers access to their paychecks up to two days in advance of payday.

For Safaricom, responding to the reality of how people manage their money doesn’t only mean greater revenue, but also higher customer satisfaction, says Murekio. “The biggest benefit has been that customers no longer have to lose an opportunity because they don’t have the funds at that moment.”