Vodacom points to strong growth in financial services business

Vodacom Group on Tuesday (2 February), reported 3.9% growth in service revenue for the quarter ended December 2020, driven by strong activity in South Africa.

South Africa service revenue was up 5.4% reflecting strong demand for new services and connectivity, it said.

International service revenue declined by 1.4%, with M-Pesa supporting a notable sequential improvement in the year-on-year decline of normalised service revenue.

“Supported by a significant increase in demand for our Airtime Advance product and a healthy increase in insurance policies, our Financial Services business remains a very strong performer having increased revenue by 24.3%, as the business continues to scale,” said Shameel Joosub, Vodacom Group chief executive officer.

Revenues from M-Pesa increased 10.1%, largely the result of a 7.7% increase in customers, with almost 16 million people now making use of the M-Pesa platform.

Including Safaricom, monthly M-Pesa transactions were $24.2 billion, up 57.8% year-on-year.

Vodacom said it invested R3.4 billion in itsnetwork across the group in the quarter – including the expansion of 4G coverage, speeds and capacity.

“In South Africa alone, we invested R2.7 billion to support data demand and shifts in customer behaviour patterns with a need to work, entertain and educate from home,” Joosub said.

Looking ahead, Joosub said that participating in the Independent Communications Authority of South Africa’s (ICASA) High Demand Spectrum auction is a key strategic priority for the group in the quarter ahead.

“We see the assignment of spectrum as instrumental in extending coverage, improving quality of service and lowering the cost to communicate in South Africa. Any further delays to this process will likely have a negative impact on consumers.”

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