South Africans borrowed R3.4 billion worth of airtime from Vodacom in the quarter ended December, which amounted to a big chunk of the telco’s prepaid recharges in the period.
Vodacom reported its third quarter 2023 performance today, saying its airtime advance product boosted its financial services revenue in the period.
The telco’s Airtime Advance product allows Vodacom prepaid customers to receive airtime or data in advance and pay for it later.
In the quarter, Vodacom’s service revenue from financial services was up 12.6% to R779 million, with the customer base reaching 14.7 million.
“Our Airtime Advance product remained a key contributor to financial services revenue, and posted a pleasing acceleration in the third quarter. We advanced R3.4 billion in airtime, amounting to 45.1% of total prepaid recharges,” says Shameel Joosub, Vodacom Group CEO.
On the telco’s super app, which is part Vodacom's financial services strategy, Joosub says in the quarter: “VodaPay continues to gain traction with more than 4.5 million downloads, 2.7 million registered users and over 100 mini apps. We continue to expand our offerings as we drive deeper penetration of financial services, and are on track to scale VodaPay cash-in/cash-out in the next financial year.”
Vodacom financial services have ballooned in recent years as part of the group’s fintech plans, supported by insurance, new products and improved performance of the airtime advance product.
In the current reporting period, Vodacom Group financial services revenue reached R2.6 billion in the quarter, up 30.6%.
In South Africa, growth was fuelled by its insurance business, which posted revenue growth of 13.5% and a recovery in airtime advance revenue growth.
On M-Pesa, Africa's most successful mobile money service, Joosub notes normalised M-Pesa revenue grew 18.3% in the third quarter.
“New financial services, such as loans and merchant services, contributed half of M-Pesa. Our M-Pesa platform, including Safaricom, processed $366.7 billion of transaction value over the last 12 months, up 17%, representing clear leadership in the African fintech space.”
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