How to Use M-PESA Without a Bank Account (2023)

Written By Shayan Shamim

You do not need a bank account to use M-PESA. The mobile transfer service was launched to target unbanked and less connected individuals. It lets users send, deposit, withdraw, and spend money via mobile phones.

The Kenyan mobile banking industry has been thriving in the past few years and is expected to grow at a CAGR of 10% crossing the mark of $68 billion by 2024. As more and more people embrace mobile banking, the prospect of enhanced financial inclusion and connectivity proliferates.

M-PESA is leading the charge of revolutionizing the mobile banking system in Kenya and beyond.

In this article, I will delve deeper into the world of M-PESA and answer your queries regarding M-PESA and its use.

What Is M-PESA and How Does It Work?

M-PESA is a microfinancing and money transfer service founded by Safaricom and Vodafone. It allows users to send money via their mobile balance via pin-based SMS service and pay vendors.

M-PESA is a mobile money transfer and payments service launched in 2007 in Kenya by Safaricom and Vodafone. It was launched to target the country’s unbanked population, which relied heavily on pre-pay mobile services.

The M stands for Mobile, while Pesa is money in Swahili. M-PESA is currently available in:

  • Afghanistan
  • Democratic Republic of Congo
  • Egypt
  • Ethiopia.
  • Ghana
  • Kenya
  • Lesotho
  • Mozambique
  • South Africa
  • Tanzania

The service rapidly caught popularity by enabling users to perform basic banking transactions from their phones. M-PESA is not a bank account but a mobile money balance stored in a collective ring-fenced bank account. Each mobile balance is linked to the customer’s mobile number, the digital wallet, for transactions.

M-PESA currently has over 41.4 million active users performing over 12.2 billion transactions in various Vodafone-supported countries.

Do You Need a Bank Account to Use M-PESA?

You do not need a bank account to use M-PESA. The service is specifically designed to provide banking access to individuals without access to bank accounts.

In rural areas of Kenya, bank branches are scarce and not easily accessible.

Sometimes, reaching the nearest bank on a walk can take up to a day. This is where M-PESA comes to the rescue.

The mobile banking service allows customers to perform monetary transactions without opening a bank account.

Users can send or receive money from anywhere in the country via their mobile handsets, thus enabling unbanked individuals in rural areas to participate in online money transfers.

Merchants also do not need to have a bank account to use M-PESA. They can use the service like other users and transfer, receive, and store their money in their M-PESA mobile account.

M-PESA is a relatively cheaper and faster method of transferring, receiving, or paying money than bank accounts.

The service works in real-time and solely via your mobile phone. Each transaction is protected by a PIN making the service safe and secure.

How to Deposit Money to Your M-PESA Account?

You can quickly deposit money into your M-PESA account by visiting an agent and providing the required amount. You will receive the money in your account and an SMS indicating the successful transaction.

To start your mobile banking journey with M-PESA, you must first open an account with the service. Yovisitsiting any of the 160,000 M-PESA agents across Kenya and registering your account for free.

You will need a valid Identity document and your mobile phone with Safaricom SIM so the agent can enter the following details into the system:

  • Your first name
  • Your last name
  • ID number
  • Phone number
  • Date of birth

Once your account is registered, you will receive a four-digit system-generated PIN on your registered mobile number, which is used to confirm your account. You can change it whenever you want.

  • Now, download the Safaricom mobile app and open its menu.
  • Enter the M-PESA PIN you received for your account via SMS.
  • Now, you must change your PIN (Ensure that you remember it afterward, as all your transactions are based on it).
  • Enter the number of the Identity document you used for registering your account.
  • Confirm your registration.
  • You will receive a confirmation of account activation via SMS.

To make a deposit, simply provide the required amount to the M-PESA agent, and they will deposit the money in your account by entering their PIN.

You can hold a maximum of Ksh 100,000 in your M-PESA account simultaneously. You also have a maximum per transaction limit of Ksh 70,000. 

M-PESA does not allow you to deposit money in someone else’s account via M-PESA agents. To perform that transfer, you must send money from your M-PESA account.

Sending Money via M-PESA

You can easily send money to M-PESA registered or unregistered accounts via the Sim Tool Kit, M-PESA super app, USSD, or the Safaricom app. Unregistered recipients must register their accounts with M-PESA to receive money in their accounts.

Sending money via M-PESA is extremely easy and requires a few steps that can be performed in various ways. There are four methods of sending money to other mobile accounts, namely:

  1. Sim Tool Kit (STK)
  2. M-PESA super app
  3. USSD *334#
  4. Safaricom app

1. Sending Money via the Sim Tool Kit (STK)

If you want to send money to other M-PESA accounts without downloading any application, follow these steps:

  1. Open your Sim Tool Kit on your mobile phone and select M-PESA.
  2. Click on the Send Money option.
  3. Enter the phone number of the recipient.
  4. Enter the amount you wish to send to the recipient.
  5. Enter your M-PESA PIN to continue.
  6. You will receive a confirmation prompt asking you to either OK or Cancel the transfer. Select OK if all the recipient’s mobile number is correct.
  7. In this step, select 1 to confirm the transfer or 2 to cancel it.

You will receive an SMS on your registered number regarding the successful completion of the transfer.

2. Sending Money via the M-PESA Super App

To use this method, you must download the M-PESA Super App from Play Store or App store. Ensure your mobile data is turned on instead of the WiFi for first-time use.

  1. Open the application and sign in using your mobile number.
  2. You will be required to accept the terms and conditions.
  3. Enter your M-PESA PIN to continue the registration.
  4. You can choose to enable biometric or facial recognition verification for future use.
  5. Now, on the Home tab, select Send and Request.
  6. Select Send Money
  7. Enter the recipient’s phone number or choose the number from your contacts.
  8. Now, enter the required amount and proceed.
  9. Enter your M-PESA PIN or biometric verification as per your preference.

Your transactions will be completed, and you will receive a confirmation on your mobile number.

3. Sending Money via USSD

If you are located in an area without internet, you can perform transactions via the USSD service of M-PESA.

  1. Dial *334# from your registered Safaricom SIM.
  2. Select the Send Money option and proceed.
  3. Enter the recipient’s phone number.
  4. Provide the sending amount.
  5. Enter your M-PESA PIN.
  6. Once the confirmation prompt appears, select the accept option to transfer the money successfully.

4. Sending Money via the Safaricom App

The process of sending money via the Safaricom app is similar to that of the M-PESA Super app.

  1. Download the Safaricom App from the App Store or Play Store.
  2. Once you have registered with the application, launch the Safaricom app and select Send Money.
  3. Enter the recipient’s phone number.
  4. Enter the amount you want to send.
  5. A prompt will appear asking you to confirm your transaction. Select Send.
  6. Use your M-PESA PIN or biometric verification to complete the transfer.

Withdrawing Money From M-PESA

You can withdraw funds from your M-PESA account by visiting an agent or an ATM. Ensure that your M-PESA agent has the required funds for the transfer beforehand.

M-PESA was designed to keep the convenience and accessibility of the population in mind. Thanks to the various fund withdrawal methods, getting your money in cash is effortless.

The two ways you can withdraw funds if you are a registered user:

  • Via an M-PESA agent
  • Via an ATM

Withdrawing Funds Via M-PESA Agent

To withdraw funds using this method, you need to visit the nearest M-PESA agent and inquire if they have the necessary funds for the transfer. Some agents might need more cash on hand to facilitate the transaction; therefore, it is essential to ask in advance.

There are four ways you can get cash from your agent:

  • Using Sim Tool Kit (STK)
  • Using Safaricom app
  • Using M-PESA Super app
  • Using USSD

Using Sim Tool Kit (STK)

  1. Open the Sim Tool Kit (STK) and select M-PESA.
  2. Select Withdraw Cash
  3. Choose From Agent
  4. Enter the agent number displayed provided by the agent.
  5. Now, enter the amount you want to withdraw.
  6. Confirm the transaction
  7. You and the agent will receive an SMS for a successful transfer.
  8. The agent will then hand over the cash to you.

Using Safaricom app

  1. Open the Safaricom app.
  2. Navigate to the M-PESA tab and choose Withdraw Cash.
  3. Now, select From Agent
  4. Enter the agent number and the required cash amount.
  5. Confirm your transfer; the agent will give you the money once they receive the confirmation text.

Using M-PESA Super app

  1. Open the M-PESA Super app and select Withdraw.
  2. Choose the Withdraw at Agent option and enter the agent number.
  3. Enter your required amount and confirm the transaction to receive the money from the agent.

Using USSD

  1. Run the *334# USSD code on your Safaricom number.
  2. Select Withdraw Cash
  3. Choose Withdraw from Agent
  4. Now, enter the withdrawal amount.
  5. Confirm your transaction, and the agent will give you the cash upon confirmation.

Withdrawing Funds Via ATM

The ATM withdrawal service is available only to registered M-PESA users. To withdraw funds using this method, you must visit your nearest ATM with your mobile phone with the registered Safaricom SIM.

The process involves two steps – mobile phone and ATM

  1. Open the Sim Tool Kit (STK), Safaricom app, and M-PESA Super app on your mobile phone, or run the *334# USSD as you prefer.
  2. Select Withdraw from the ATM
  3. Enter the ATM number written on the ATM.
  4. Now, provide your M-PESA PIN for confirmation.

You will receive a six-digit authorization code on your registered mobile number, valid for 10 minutes only, so you have to move fast.

  1. The next step is to choose the M-PESA option on the ATM.
  2. Choose your preferred language to proceed.
  3. Now, enter the six-digit authorization code you received.
  4. In the next step, enter your registered mobile number.
  5. Enter the amount you wish to withdraw and continue with the transaction.
  6. Collect your money from the ATM along with the transfer receipt.
  7. You will also receive a confirmation SMS on your mobile phone for a successful transfer.

Withdrawing Funds Via M-PESA Agents for Unregistered Users

Unregistered users need help to avail themselves of the deposit or withdrawal services provided above. However, if you are sending funds to an unregistered user, the recipient will receive a one-time four-digit code which they can use to cash out their funds via an M-PESA agent.

If you are an unregistered user receiving funds via this service, follow these steps:

  1. Visit an M-PESA agent with your mobile phone, original ID, and the received four-digit code.
  2. Ensure that the agent has the required funds on hand.
  3. Show them the confirmation SMS you received.
  4. Show your original ID and provide your phone number.
  5. The agent will confirm the transaction and provide you with the cash upon confirmation.

The Bottom Line

M-PESA has revolutionized the mobile banking industry in Southeastern Africa.

The mobile payments giant has enabled millions of individuals to participate in online money transactions empowering and uplifting 194,000 households out of poverty.

You can easily register an account with the service to transfer, deposit, and receive funds from anyone across the country without ever having to open a bank account.

With the wave of digitization across Africa, M-PESA may become a full-fledged bank account in the coming years.

If you found this article useful, check out more written by me and our team:

About the Author

Analyst, Digital Banking in Asia at TopMobileBanks

Shayan Shamim is a finance graduate with expertise in financial modeling and investment banking. He is a fintech enthusiast and is constantly on the lookout for innovations in finance.

He is an avid reader and loves exploring the world. Whenever he is not writing or creating dashboards, he is trying out something stupid in the kitchen.

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