There’s been a lot of talk recently comparing M-PESA in Kenya with that in neighboring Tanzania. I shared some of my initial impressions a few months ago after visiting both countries. While on the surface the countries appear to be similar, there are some important differences in geography, culture and market structure that have impacted the way M-PESA has fared in each place.

The latest news out of Vodacom in Tanzania, however, is that M-PESA now has more than a million customers transferring $12.8 million per month at 2,000 agent locations since launching in April 2008. This is a significant increase from the last set of statistics from May 2009 when M-PESA had 280,000 customers, transferring $5.5 million per month at 930 agent locations.

I find this to be encouraging news not only because more Tanzanians have access to a valuable financial service, but also because it teaches us something constructive about launching branchless banking initiatives. If success is not quick and immediate (as it was in Kenya), providers may just need to persevere, be flexible to changing strategy in response to customer and agent demands, and remain committed to reaching success.

Over the last several months, Vodacom has made strategic changes that may explain to some extent the increase in usage. GSMA’s Mobile Money for the Unbanked put out an interesting paper last month that highlighted some of the learning from the two countries and the recent changes made by Vodacom.  These include a simpler pricing model, a more targeted education-based marketing campaign, and the introduction of an aggregator model to better manage and support its distribution network.

Ideally it would be best to have firm strategies at the outset of any launch. But practically this is not always possible. The next best solution is to be flexible enough to adapt one’s strategy to meet the needs of the market. Let’s hope that Vodacom’s M-PESA in Tanzania continues to make this case.