M-Kopa, a prominent asset financing company, has initiated a significant export operation, now dispatching 15,000 locally assembled mobile phones to Uganda on a monthly basis. This export volume constitutes 10% of the company’s total monthly production of 150,000 devices, which are assembled at its facility in Nairobi. This strategic move into the Ugandan market follows a notable expansion of the company’s manufacturing capabilities: output at the Nairobi plant has increased by 25% from its previous average of 120,000 units per month as recorded in October 2024 The primary drive behind these exports is a strategic objective to lower operational costs, a measure that is anticipated, to reduce the incidence of customer payment defaults.
The company’s venture into Uganda commenced in the third quarter of 2024 with an initial trial consignment of 1,000 phones. This approach offers a distinct cost advantage over the alternative of selling devices manufactured in China, which are subject to a 10% import duty, thereby inflating the final cost to the consumer.
A key facilitator of this trade is the East African Community (EAC) Common Market Protocol, which exempts Kenyan-manufactured goods from import duties within the region. While M-Kopa maintains an independent operational unit in Uganda, the establishment of a local assembly plant has been deferred. As explained by Martin King’ori, M-Kopa’s Kenya General Manager, the current output levels do not yet justify such an investment. He confirmed that the company aims to progressively increase exports to meet Ugandan demand, after which, the possibility of local assembly will be seriously considered.
The M-Kopa Model
M-Kopa’s business model involves selling these branded phones, alongside devices from manufacturers like Samsung, on a hire-purchase basis under a pay-as-you-go (PAYG) system. Customers pay an initial deposit and then settle the remaining balance through daily, weekly, or monthly instalments. The devices are equipped with a locking mechanism that disables them in the event of a payment default.
This venture into local assembly was catalyzed in January 2023, prompted by the Kenyan government’s introduction of a 10% percent excise duty on imported phones, which compounded the existing 25% import duty. In response to this regulatory change, M-Kopa partnered with HMD, the Finnish manufacturer of Nokia phones, to locally assemble its own branded smartphones as well as certain Nokia models. This initiative has positioned M-Kopa as one of the two major phone assemblers in Kenya, alongside the Safaricom-led consortium, East Africa Device Assembly Kenya.
The company has achieved a significant milestone, having assembled over 2 million devices to date, and has recently expanded its operations to include refurbishing phones for the local market. According to Mr. King’ori, refurbished units accounted for approximately ten percent of all smartphones sold in Kenya in the eight-month period leading to August 2025.
Furthermore, M-Kopa has reported considerable success with a bundled value-added service: a free health insurance coverage offered in partnership with Turaco Insurance. Since its introduction in January 2024, this initiative has surpassed two million customers, providing a cover of KES 1,000 for every night spent in a hospital. These 2025 disclosures follow the UK-headquartered firm’s announcement of its first-ever net profit of KES 1.2 billion last year, marking a pivotal turnaround after operating at a loss since its founding in 2010.
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