M-Pesa partners with UAE blockchain firm to roll out stablecoin payments in Kenya

M-Pesa has partnered with UAE-based blockchain group ADI Foundation to introduce stablecoin-based payment solutions in Kenya and other African countries where the mobile money platform operates.

The partnership will see M-Pesa integrate blockchain technology into its payment infrastructure, allowing users and businesses to transact using stable digital currencies whose value is pegged to major global currencies such as the US dollar.

Stablecoins differ from traditional cryptocurrencies by maintaining a relatively fixed value, making them suitable for payments, remittances, and commercial transactions.

Focus on cross-border payments

According to the companies, the initiative will focus on improving cross-border payments by reducing transaction costs, shortening settlement times, and increasing transparency.

Cross-border transfers in Africa are often slow and expensive due to reliance on correspondent banking systems and multiple intermediaries. The use of blockchain technology is expected to allow near-instant settlement and lower processing fees.

The development is expected to benefit small businesses, freelancers, and traders who regularly receive or send payments across borders.

Expansion across African markets

The rollout will cover eight African countries where M-Pesa operates, expanding the platform beyond traditional mobile money services.

Financial analysts say the move could improve access to digital financial services, particularly for users without access to formal banking but who already rely on mobile money for daily transactions.

M-Pesa has millions of active users across Africa, positioning it to deploy new payment technologies at scale.

Regulatory considerations

The introduction of stablecoin payments will require regulatory oversight to address consumer protection, data security, and compliance with existing financial laws.

Regulators are expected to develop or update frameworks governing digital assets to ensure safeguards against fraud, misuse, and system failures.

Kenya’s financial regulators have previously taken a cautious approach to digital currencies, and any large-scale rollout is expected to involve close engagement with authorities.

Impact on Kenya’s fintech sector

The partnership highlights the continued evolution of mobile money services as they adapt to emerging financial technologies.

Kenya has been a leader in mobile money innovation, and the adoption of blockchain-enabled payments could further strengthen its position in Africa’s fintech ecosystem.

M-Pesa said the initiative aligns with its strategy to enhance efficiency, expand services, and respond to changing consumer and business payment needs.