How agent commission actually works
Safaricom pays agents on a tiered schedule by transaction value (deposit, withdrawal). The blended effective rate after commissions, super-agent splits, and zero-commission inactive tiers averages 0.4-0.6% of volume processed. Use 0.45% as a realistic default.
The float economics
On KES 100k float doing 60 transactions/day at avg 2,500 (= 150k daily volume), you make roughly 675/day in commission, KES 17.5k/month. Subtract rent, telecoms, and other ops, and your net might be KES 8-12k. That's 9-14% annualised return on float, better than most savings accounts, similar to SACCO.
Where it goes wrong
- Float runs dry: customers want a 50k withdrawal, you don't have it, they go to the next shop. Always keep float = ~3x your largest single typical transaction.
- Theft / fraud: USSD scams, fake reverse calls. Train staff and verify every reversal directly with the customer.
- Location decline: a stand losing footfall (mall closures, road works) directly cuts revenue.