Settlement
Also known as: payment settlement, M-PESA settlement, merchant settlement
Full definition
Settlement is the phase that follows authorisation and clearing: the actual movement of funds from the payment network into the merchant's bank account, net of network fees and refunds. On M-PESA, when a customer pays a merchant paybill or till, the funds sit as an e-float balance on the merchant's Safaricom M-PESA business account. That balance settles into the merchant's linked commercial bank account either same-day (on request, standard for enterprise-tier paybills) or T+1 (next business day) by default.
On cards, Kenyan acquirers (KCB, Equity, DTB, StanChart, I&M, and international acquirers) run daily settlement batches: end-of-day cutoff, the acquirer nets the day's transactions and pushes the net into the merchant's account the next business day (T+1). Cross-border card settlement (a US card used on a Kenyan merchant) can take 2 to 4 business days and involves FX.
On PesaLink and RTGS bank-to-bank rails, settlement is essentially instant (PesaLink) or same-day (RTGS). Settlement timing matters for a merchant's working capital: a business that settles same-day can restock inventory the next morning; a business that settles T+3 has to fund those 3 days out of its own float.
Worked example
A Nairobi supermarket takes KES 1.4M through M-PESA Buy Goods on a Friday. On the default T+1 settlement schedule, that money hits its KCB current account on Monday morning (Sat and Sun are non-business days). On same-day settlement (opt-in) it would hit Friday evening.
Verified 2026-09-01. Definitions on paybillke are sourced from Safaricom PLC Annual Report FY2026, the Central Bank of Kenya, the Communications Authority of Kenya, the Kenya Revenue Authority, and the primary operator documentation for each product. How we verify. Report a change.