The verdict in three sentences
Between an M-Pesa Till and Airtel Money, the merchant fee looks tiny line by line, but it compounds fast on volume. On an average basket of 2,000 KES, picking the right rail moves your margin by 0.4 to 1.2 points. The right reflex: do not judge on the headline rate alone, but on the total cost to collect including settlement speed and Till vs Paybill choice.
Understanding total cost to collect
The collection fee is only the visible part. Three items weigh on real margin:
- Collection fee: charged on each customer payment.
- Till vs Paybill: Buy Goods (Till) tiers differ from Paybill.
- Settlement speed: money held has a cash-flow cost.
An M-Pesa Till is free for the buyer but carries tiered merchant charges; Airtel Money merchant sits around 1 % with its own settlement calendar.
M-Pesa Till vs Airtel Money (2026 order of magnitude)
| Criterion | M-Pesa Till | Airtel Money |
|---|---|---|
| Merchant fee | ~0.55 % (tiered, capped) | ~1 % |
| Buyer cost | free (Buy Goods) | free |
| Daily limit | ~500,000 KES | ~500,000 KES |
| Settlement | near-instant | T+1 |
| Coverage Nairobi | dominant | strong |
| API | Daraja | Airtel API |
Estimates for 2026, confirm against your merchant contract. M-Pesa dominates user coverage in Nairobi, which often justifies keeping a Till as the default even at slightly different tiers.
Margin impact by volume
| Monthly volume | M-Pesa (~0.55 %) | Airtel (~1 %) | Monthly gap |
|---|---|---|---|
| 200,000 KES | 1,100 KES | 2,000 KES | 900 KES |
| 600,000 KES | 3,300 KES | 6,000 KES | 2,700 KES |
| 1,200,000 KES | 6,600 KES | 12,000 KES | 5,400 KES |
| 2,000,000 KES | 11,000 KES | 20,000 KES | 9,000 KES |
The gap becomes material beyond ~600,000 KES monthly. The winning play: offer both rails at checkout and let the customer choose, while quietly defaulting to the cheaper one when coverage is equivalent.
Mini case study
Grace runs a phone-accessories shop in Nairobi. She takes 300 orders/month, average basket 2,000 KES, i.e. 600,000 KES revenue.
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All on Airtel Money: 6,000 KES fees/month. Routing 70 % through an M-Pesa Till (dominant among her customers): 70 % at 0.55 % + 30 % at 1 % = 2,310 + 1,800 = 4,110 KES. Saving: 1,890 KES/month, i.e. ~22,680 KES/year, without losing a single sale. Enough to fund her annual store maintenance.
FAQ
Should I really offer both rails at checkout?
Yes. A customer who only has Airtel abandons if you only accept M-Pesa. Offering both cuts cart abandonment by 5 to 10 points and lets you optimise fees.
Is Airtel Money always pricier than an M-Pesa Till?
Generally Airtel sits near ~1 % versus M-Pesa Till tiers around ~0.55 % in 2026, but M-Pesa's coverage is dominant. The choice is coverage-first, cost-second.
Till or Paybill for e-commerce?
Till (Buy Goods) suits retail with no reference; Paybill suits recurring or account-based collection where you need an account number in the reference.
Does the daily limit block me?
For most shops, no. For large B2B baskets you split or negotiate a raised-limit merchant account with the operator.
Can routing to the cheaper rail be automated?
Yes, a unified payment layer can route by rules (amount, availability) while keeping the customer's choice visible.
Let's talk about your project. We integrate M-Pesa Till and Airtel Money into your store and optimise your collection costs in Nairobi. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
