A story of moral imagination and bold entrepreneurship | Sitoyo Lopokoiyit and Jacqueline Novogratz

Summary

TED Talks Daily Episode Summary: "A Story of Moral Imagination and Bold Entrepreneurship | Sitoyo Lopokoiyit and Jacqueline Novogratz"

Release Date: July 10, 2025

In this compelling episode of TED Talks Daily, host Elise Hu introduces a profound conversation between Impact Investor Jacqueline Novogratz and Sitoyo Lopokoyit, the CEO of M-Pesa, Africa's largest fintech platform. The discussion delves into how M-Pesa has revolutionized financial access across Africa, showcasing the transformative power of financial inclusion and smart technology in uplifting entire communities.

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1. Introduction to M-Pesa's Impact

Jacqueline Novogratz opens the conversation by highlighting the groundbreaking influence of M-Pesa in disrupting traditional industries. She notes:

“For the last 25 years, I've been investing in social enterprises focused on solving problems of poverty. And for the last 20, M-Pesa has fundamentally accelerated them.”
(03:14)

Novogratz emphasizes the unexpected emergence of M-Pesa in 2007, a year marked by technological innovations like the iPhone and IBM's Watson. Unlike its contemporaries, M-Pesa focused on mobile banking, a concept that initially overlooked but soon transformed societal transactions in Kenya.

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2. Founding Insights and Early Challenges

Sitoyo Lopokoyit recounts the foundational insights that led to M-Pesa's inception:

“Before we launched in 2007, we were piloting with a microfinance institution with a women's only group… the only way they could [send money] is physical money.”
(05:14)

These insights revealed the logistical challenges of rural-urban migration and the limitations of traditional money transfer methods. Combining these observations, M-Pesa introduced its first proposition: "Send money home", simplifying the process through SMS-based transactions and establishing a robust agent network akin to Coca-Cola distribution points.

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3. Scaling and Transforming Economies

The conversation transitions to M-Pesa's expansive growth and its profound economic impact:

“It's over $400 billion of value going through the ecosystem. 180 million transactions… over 60% of the GDP of the countries flowing through the M-Pesa ecosystem.”
(09:45)

Lopokoyit elaborates on M-Pesa's evolution from simple money transfers to a comprehensive financial ecosystem, including savings, lending, credit, wealth management, and international money transfers. This expansion has not only facilitated daily transactions but also integrated businesses, governments, and multinationals into the platform.

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4. Commitment to Moral Imagination

Jacqueline Novogratz and Sitoyo Lopokoyit share a deep-seated belief in moral imagination—designing business solutions from the perspective of those they aim to serve, particularly the overlooked and underestimated. Novogratz states:

“What we need in the world are social entrepreneurs who are using business grounded in moral imagination.”
(05:14)

Lopokoyit underscores this by sharing M-Pesa's continuous efforts to address real-life problems through innovation, such as developing Braille watches for visually impaired users to access financial services with dignity.

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5. Innovations Enhancing Inclusivity

One notable example of M-Pesa's inclusive innovations is the collaboration with The Braille Company:

“We built the first Braille watch for visually impaired people in Kenya. And that meant that over a million people now can access financial services with dignity.”
(11:41)

This initiative exemplifies how M-Pesa leverages technology to ensure that financial services are accessible to all, regardless of physical limitations.

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6. Expanding into Energy and Agriculture

M-Pesa's "adjacent possible" strategy involves creating economic rails that support various industries. In energy, the partnership with Delight introduced pay-as-you-go solar systems, enabling millions to access clean energy through mobile payments. Novogratz reflects:

“M-Pesa has essentially created economic rails, a whole platform on which many other industries can be built.”
(14:31)

In agriculture, M-Pesa collaborates with the Kenyan government to digitize fertilizer subsidies, enhancing transparency and efficiency. Lopokoyit shares impressive statistics:

“Over $288 million of fertilizer has been sold through the platform. In 2022, there are 1.4 million farmers. Today is 6 million farmers on it.”
(16:03)

These initiatives have led to significant increases in agricultural productivity and reductions in food importation, thereby strengthening Kenya's economy.

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7. Leadership and the Future of Africa with AI

Paying homage to Bob Collymore, former CEO of Safaricom, both speakers underscore the importance of moral leadership. Lopokoyit discusses Africa's burgeoning population and the critical role of AI:

“We need to put sort of a handbrake on AI… build algorithms that are relevant to Africa and not just transport the algorithms there.”
(18:31)

He warns against a form of digital colonialism, advocating for AI solutions tailored to Africa's unique needs to ensure meaningful societal impact.

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8. Conclusion: Empowering the Overlooked

Novogratz concludes by reiterating the essential role of corporate leaders in advocating for and empowering the overlooked:

“Corporate CEOs like Bob, like you, my friend Sitoyo, have a role to play in the world today to stand up for those who are overlooked, underestimated, and who we desperately need to be as to be realizing their human potential.”
(20:28)

Lopokoyit echoes this sentiment, emphasizing the continuous pursuit of innovation to solve real-world problems and uplift communities.

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Key Takeaways

• M-Pesa's Foundational Insights: Addressing the challenges of money transfer in rural-urban contexts through SMS-based banking and a widespread agent network.

• Economic Transformation: Facilitating $400 billion in transactions and integrating 60% of the GDP of several African countries into its ecosystem.

• Moral Imagination: Designing business solutions with a deep understanding of and empathy for the target communities.

• Inclusivity through Innovation: Developing accessible financial tools for the visually impaired and digitizing agricultural subsidies to enhance transparency.

• Expanding Horizons: Creating platforms that support diverse industries like energy and agriculture, driving widespread economic growth.

• Leadership for the Future: Advocating for tailored AI solutions that respect Africa's unique societal needs and prevent digital colonization.

This episode underscores the profound impact that visionary entrepreneurship, grounded in moral principles, can have on transforming societies and economies. Through M-Pesa, Sitoyo Lopokoyit exemplifies how bold, inclusive innovations can address entrenched social challenges and pave the way for a more equitable future.

Transcript

[Elise Hu]

You're listening to TED Talks Daily where we bring you new ideas to spark your curiosity every day. I'm your host, Elise Hu. I'm always amazed by how entrepreneurial minds are able to solve some of the biggest, most intangible problems we face, seeing scalable solutions against all odds. This is one of those stories. In this conversation, Impact investor Jacqueline Novogratz speaks with Satoyo Lobokoyet, the CEO of M Pesa, Africa's largest fintech platform, to learn how M Pesa's digital banking ecosystem has revolutionized financial access across Africa. It demonstrates how financial inclusion and smart technology truly have the power to uplift entire communities. That's coming up.

[Sitoyo Lobokoyet]

Foreign.

[Elise Hu]

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[Jacqueline Novogratz]

I am so excited to have this conversation with Ctoyo for so many reasons, but three that I'll start with. First of all, he disrupted the first two industries I worked in. I started off in traditional banking and then in 1986 started co founded the first microfinance bank in Rwanda. Both disrupted by M? Pesa. For the last 25 years, I've been investing in social enterprises focused on solving problems of poverty. And for the last 20, M? Pesa has fundamentally accelerated them. And the second reason is the unexpected. M? Pesa was founded in Kenya. What's so extraordinary is this is 2007, which was the year of the iPhone. And when IBM introduced Watson, it was the year of Kindle and Airbnb. And not enough people paid attention to this notion that cell phone banking could be a thing. It would take years before the United States and China took it on themselves. And now when I'm in Nairobi, I can buy a banana or roasted corn on the street in ways that in New York, often at restaurants, I still can't. I need my credit card. And so it has fundamentally transformed society. The third which we're going to get to is the moral imagination. Sitoyo and I share a belief that what we need in the world are social entrepreneurs who are using business grounded in moral imagination. In other words, they are fundamentally designed from the perspective of those they are here to serve, particularly the overlooked and the underestimated. And M? Pesa has done that like very few other social enterprises. So thank you for this conversation.

[Sitoyo Lobokoyet]

You're welcome.

[Jacqueline Novogratz]

And let's start at the beginning.

[Sitoyo Lobokoyet]

Sitoya first, it's great to be here and apologies for disrupting you twice. I think in your journey you've always talked about patient capital. So I think the patience paid off and I think we came. Good for you. I think for M? Pesa it started with two insights and I think that's the DNA of M? Pesa. Before we launched in 2007, we were piloting with a microfinance institution with a women's only group which we are trying to give out loans to the women and then see what happens. And what was happening is, for example, you are sending to her the SMS and in that pilot, that's what the first insight we had and the second insight that came is a challenge that Kenya had with regards to rural urban migration. So people in the urban areas wanted to send money back home or to their families, to the friends, or to do farming as an example. And the only way they could do that is physical money. So if I wanted to send money to my mother, who is 500km away from Nairobi, I would write a letter, then put money into it. I'd look at it in the light, just make sure you can see the money. You give it to a bus driver and then the next day she would go and pick it. And those two insights combined to create our first proposition, Send money home. And that became how. That's how m Pesa started 18 years ago. And one thing was how do you ensure that somebody in rural Kenya with very little education or no education can receive an SMS and knows it's money. If it's deleted, she has the confidence that the money is there. Or if she loses her phone, she knows the money is there. What we did, we built an agent network. This is a simple mom and pop shop, every single. And we mapped it to Coca Cola that in every little village is a Coca Cola shop. So in every little place we put MPESA agent outlets. And that meant when you receive the money on sms, you would actually go to an agent and cash it out. And that builds trust on M Pesa. And that's how today we have over 700,000 agents and we employ directly 1.5 million people in our agent network.

[Jacqueline Novogratz]

And could you even go beyond jobs, Sitoyu, and talk about the overall stats if you will, and the impact that M Pesa has today?

[Sitoyo Lobokoyet]

I think first we started with the send money home proposition and then looking at insights, ideas, intensely looking at what customers are doing. And we moved to a payment proposition for utilities, water, electricity. Now we've moved into savings, lending, credit, wealth management, international money transfers. Today we connect. You can send money from over 200 countries into Kenya. I can send money, I can bet this whole audience I can send money to your bank account directly. It's over 3 billion bank accounts. We can send to or to any mobile money platform. And we are connecting families across in terms of, let's just say international money transfer. We've dropped that down from highs of 10 to 15% to right now we had SDG level which is about 3% from that. And then we moved into the more, you know, the growth areas which is impacting the economy down from governments to the stock exchange, multinationals, Coca Cola, all these guys run on M? Pesa. And then we've digitized SMEs and micro SMEs.

[Jacqueline Novogratz]

And I want to get into all of this stuff, but I just want to give the high line, which is what? $1.5 billion a day, 60 million customers.

[Sitoyo Lobokoyet]

We are shy in saying that the numbers but it's over $400 billion of value going through the ecosyste.

[Jacqueline Novogratz]

You're so humble. I'm trying to like.

[Sitoyo Lobokoyet]

It's 180 million transactions in most of our markets. It's between 30 and to markets like Kenya. It's over 60% of the GDP of the countries flowing through the M? Pesa ecosystem. So it's really transformative in terms of. Thank you in chuit. And we in terms of, let's say just lending, we lend over $50 million a day with NPLs below 3%, which is unheard of anywhere in the world.

[Jacqueline Novogratz]

So I want to get back to the moral imagination because this is a massive company. To go into the office of M Pesa Safaricom where it's housed is like going into a central bank. 60% of GDP and there's a lot of security to get it as well. But you started off thinking you would be a nonprofit, a true social enterprise that started off with a 2 million pound grant. And it's a really important point for all the social entrepreneurs in this room and the philanthropists. Because we need the right kind of capital to enable people like Citoyo to build markets that have never existed, particularly for low income people. And that takes experimentation and failures and starting over again. You've continued with that sense of the moral imagination to see yourselves not just to make money, although you make plenty of money, but to solve social problems and to really understand who your customers are. Even though especially because they might make one or two or three dollars a day. Could you give me some examples of where that has continued to fuel who you are and how you operate?

[Sitoyo Lobokoyet]

Yeah. I think for us is every single day I walk into the office, it's like the first day at work. And I've been in MPESA for a very, very long time. And it's because we enter there every single day trying to solve real life problems. We look at insights, we innovate around that. So just imagine in Kenya today there's 6 million visually impaired people and 1 million people are blind. Now how do those people who are excluded get to leave to do financial services with dignity in 2018? We got to work with A fantastic company from South Korea called the Braille Company. And we built the first Braille Braille watch for visually impaired people in Kenya. And that meant that over a million people now can access financial services with dignity. And that DNA of how we create products and services is what we carry.

[Jacqueline Novogratz]

On till today in a moment of history where we have so little forgiveness. Seemingly something I've learned in 40 years of working in and out of Africa is that quality of forgiveness. And you've integrated that as well just in 20 seconds or less. Say something about the Financial Inclusion Fund.

[Sitoyo Lobokoyet]

So it's about two years ago we created something called Hasla Fund in collaboration with government. And the government wanted everyone above 18 to have a clean slate. And we worked with them. And they removed 9 million people from the credit reference bureau and gave them a fresh start to rebuild their credit. And with that, over 20 million Kenyans got back access to financial services from a clean slate.

[Jacqueline Novogratz]

We need this kind of thinking today. I want to move to the adjacent possible because M? Pesa has essentially created economic rails, a whole platform on which many other industries can be built. We've seen it in energy and agriculture and healthcare and just want to have a conversation about how you've seen these adjacencies evolve.

[Sitoyo Lobokoyet]

I think this is great. I think when we opened the M? Pesa ecosystem and opened the API allowed more innovation to come into M? Pesa. And I strongly believe there's more innovation outside M? Pesa than there is in M? Pesa. And the energy or the clean energy example which you are part of is an example. I think you should talk a little bit more about that because you've impacted over 300 million people globally with access to clean energy through pay as you go solar systems.

[Jacqueline Novogratz]

Well, thank you. It's actually an interesting story that needs to be told, especially in the world today as we're looking at so many frontier markets. But the same year that M? Pesa started, a company called Delight, started with a solar light and this dream of eradicating kerosene. At the time people had to pay daily for kerosene. Like M? Pesa, they had to build trust, understand the technology, build distribution, et cetera. The big area of friction was financing. And for four years the company struggled. 2011, M? Pesa for the first time married mobile payments with off grid solar electrification. So now you could bring electricity into your house and pay for electricity the way you used to pay for dirty kerosene, except that you paid it through your phone every day, 50 cents. And if you didn't make your monthly payments by the end of the month. The solar company could call you and maybe offer you grace or shut down your unit. That was game on. Solar energy revolution because of the railways of M? Pesa. And as Satoya said, Our 40 companies have now brought electricity to 300 million people. It wouldn't have happened without this pay as you go mobile payments system. And that's been just extraordinary, just what.

[Sitoyo Lobokoyet]

You'Re saying in agriculture. So we've worked with the Kenya government to digitize the whole fertilizer subsidy program. So they're subsidizing production, not consumption. And through M? Pesa, you get to register as a farmer, you get to put their location what's your size and what you're planting and you get information, you get a voucher, you pay on M? Pesa. And government is selling fertilizers directly to its citizens. Today over $288 million of fertilizer has been sold through the platform. In 2022 there are 1.4 million farmers. Today is 6 million farmers on it. Production is up 39%. Importation of food, of maize is down 23%. And farmers are making a better living. And this accounts agriculture accounts for 30 to 40% of the GDP. And most of that is by small scale farmers who have between one to five acres of land. And we're impacting and making their lives better.

[Jacqueline Novogratz]

You've also. Agriculture is also historically a cash based industry where there's been a lot of what they call leakage, petty corruption and you've also significantly reduce that. And through our agricultural investing we've seen just massive changes. So thank you for that work as well in the interest of time, because Sitoyo and I share a mentor and someone. We have all been imprinted by one of the great moral leaders of our time, a man named Bob Collymore who ran Safaricom. And in this time where we keep looking around to say where are our leaders? Bob stands as a giant, though we lost him tragically far too young a few years ago. Sitoyo, you're an African. You have built one of the most important companies in the world. You see a continent that is going to comprise one in four of us with a median age of 19. How do you think about AI the Future, Africa's contribution in the context of the kind of moral leadership that Bob demonstrated for us.

[Sitoyo Lobokoyet]

First, I think Africa is rising. As you've mentioned, the population it's got 30% of it is, is middle class. That's over 300 million people. And for this continent to continue succeeding. It's open for trade. And that's something that's really important for us. And the part of just understanding what the continent needs is very important. And when we look at AI, I mean, there's fantastic use cases, anti money laundering, cybersecurity, you know, agriculture, health, and so on and so forth. But for me personally, I think we need to put sort of a handbrake on AI. And the reason for that is we, we need to open it up, build algorithms that are relevant to Africa and not just transport the algorithms there. Because I strongly feel that if we don't do that, it'll be a form of colonization or colonialism at a scale that we've never seen before. And it is really important that we manage that challenge from that perspective, because it's like we are racing to a finish line that's vanishing. And for Africa, we need to ensure that the solutions that are brought in make an impact to the lives of the people, on the society in which we operate in. And that's very important to me. And for the leadership part, I think I take off from Bob. He used to quote Dr. Seuss all the time, say the person is a person, no matter how small. And that's such a profound statement that we should be able to look at everybody individually and actually listen to them and try and make an impact in their lives.

[Jacqueline Novogratz]

I think that's a great note to end on. Also that corporate CEOs like Bob, like you, my friend Sitoyo, have a role to play in the world today to stand up for those who are overlooked, underestimated, and who we desperately need to be as to be realizing their human potential. And it is such an honor to know you, to work with you.

[Sitoyo Lobokoyet]

Thank you.

[Jacqueline Novogratz]

To be accelerated by you. Thank you very much.

[Sitoyo Lobokoyet]

Thank you.

[Elise Hu]

That was Satoyo Lopakoyet in conversation with Jacqueline Novogratz at TED 2025. If you're curious about TED's curation, find out [e-mail] curationguidelines and that's it for today's show. TED Talks Daily is part of the TED Audio Collective. This episode was produced and edited by our team, Martha Estefanos, Oliver Friedman, Brian Greene, Lucy Little, Alejandra Salazar and Tonsika Sarmarnivon. It was mixed by Christopher faisey Bogan. Additional support from Emma Tobner and Daniela Ballarezzo. I'm Elise Hu. I'll be back tomorrow with a fresh idea for your feed. Thanks for listening.

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