NAIROBI, Kenya- Kenya’s smartphone financing industry is grappling with a major hurdle: phone flashing, an illicit practice where users hack financed devices to bypass security locks.
This growing issue has led to financial losses exceeding KSh 100 million, disrupted sales, and even job losses.
Smartphones like the Samsung A04 and A14 series have been prime targets, with online tutorials making it easier for fraudsters to exploit the system.
Despite implementing advanced technologies like Samsung’s Knox Guard, introducing stricter Know Your Customer (KYC) protocols, and pivoting toward less hackable devices, the problem continues to undermine the sector.
“Without robust security measures, issuing financed devices becomes unsustainable,” explained Erick Massawe, Country Manager for Watu Africa in Kenya. Watu Africa, through its Watu Simu subsidiary, has sold over 1 million devices in Kenya and 1.5 million across sub-Saharan Africa.
Their partnership with Samsung, forged on the strength of Samsung’s security features, reflects the industry’s focus on protecting its assets.
Amid these challenges, key players like M-KOPA are doubling down on solutions. M-KOPA recently unveiled the M-KOPA X20 smartphone, featuring integrated financial tools designed to promote digital inclusion and affordability.
The company has already provided over 1.5 million smartphones locally and aims to sell 10 million devices in Kenya by 2027.
According to Martin Kingori, General Manager of M-KOPA Kenya, “We are committed to expanding economic opportunities and financial inclusion for millions of Kenyans while contributing significantly to the country’s economy.”
Since its inception, M-KOPA has reached over 3 million customers and contributed KSh 17.2 billion in taxes.
The sector’s future depends on collaboration between businesses, the government, and consumers. Stronger enforcement of anti-flashing laws, coupled with consumer education, will be crucial to protecting the ecosystem and promoting Kenya’s digital economy.
