By Erik Heinrich
February 14, 2014

FORTUNE — Bob Collymore, CEO of Kenya’s biggest wireless provider Safaricom, likes to say his company’s mission is to transform lives.

In 2013 Safaricom did a lot of transforming, with Kenya — the global leader in the advancement of mobile money — reporting a record $22 billion in wireless financial transactions.

This latest figure, which accounts for more than 60% of the country’s gross domestic product, compares to $17.4 billion in mobile transactions reported a year earlier, according to the Central Bank of Kenya.

The vast majority of this economic activity was conducted over Safaricom’s M-Pesa platform, which has more than 15 million subscribers and continues to gain widespread acceptance as the country’s primary system of payment for retail purchases and person-to-person money transfers.

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Yet M-Pesa has begun to experience a backlash, with critics calling some fees and conditions associated with new services — including a much-heralded savings and microfinance product known as M-Shwari — heavy-handed and even unfair. That’s a development that could stall Safaricom’s ambitious plan of becoming Kenya’s top retail bank in addition to being the country’s leading wireless provider.

“The Kenyan authorities have long recognized the potentially detrimental consequences of Safaricom’s quasi-monopoly status,” says Michael Fuchs, a Chevy Chase, Md.-based finance and development specialist who spent years in Africa working for the World Bank, “but have been reluctant to disturb, or possibly derail, the m-money revolution.”

Largely on the strength of M-Pesa’s success, Safaricom reported six-month net income of $130 million in its latest quarter. That’s the best half-year result in Kenya’s corporate history and makes Safaricom, which controls about 80% of Kenya’s wireless market, the most profitable corporation in East Africa.

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There are a couple of reasons why Safaricom, 40% controlled by the U.K.’s Vodafone Group, has been able to turn M-Pesa into both a financial bridge to Kenya’s unbanked masses and a huge moneymaker. It has invested $14 million per year to nearly triple the size of its agent network to 113,130 since 2010. That strategy has been critical to M-Pesa’s success because agents — typically retail merchants and gas stations — provide much-needed liquidity in a country where most people do not own a bank account and cannot use ATM machines.

Also, since launching in 2007 as a mobile channel for money transfers, M-Pesa has year after year added new services aimed at attracting subscribers and lifting Kenya’s unbanked majority out of poverty.

But the introduction of M-Shwari, a core banking service which debuted a little over a year ago in partnership with Commercial Bank of Africa, has been controversial.

On one hand, it has attracted more than 2 million subscribers by giving Kenya’s unbanked access to interest-bearing savings account and credit for small purchases and emergencies.

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“M-Shwari has seen huge uptake and proved the point that there is huge demand for affordable credit among the working poor,” says Kathleen McGowan, senior policy advisor with the Washington-based U.S. Agency for International Development (USAID). “Mobile money providers around the world are increasingly moving toward partnerships with banks in order to be able to provide regulated financial services beyond simple money transfer services.”

On the other hand, M-Shwari — a key component of Safaricom’s master plan of competing with brick-and-mortar commercial banks — has drawn criticism for making too much money from Kenya’s poorest.

Loans of up to $300 have a term of 30 days and carry a 7.5% rate of interest, which on an annualized basis works out to nearly 100%. “This is extremely high, and while such borrowing can provide relief to liquidity-constrained households, the transformative impact will be quite modest,” says Fuchs, who helped oversee major financial reforms in Kenya for the World Bank.

Additionally, a higher rate of interest is applied if a customer pays off his loan early or late, and while a loan is outstanding, the balance in a customer’s M-Shwari savings account is frozen up to the amount due. This creates a scenario where low-income Kenyans could in effect be borrowing from themselves.

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So far, Safaricom has not signaled any intention to change course with M-Shwari, which could cost Kenya — a nation in which two-thirds of the adult population uses mobile money, higher than any other country — and East Africa its global lead in the delivery of financial services on cellular phones.

The U.S. research firm Gartner predicts that Asia-Pacific will overtake Africa as the world’s No. 1 region as measured by the value of mobile-money transactions in 2016, reaching $165 billion to Africa’s $160 billion.

“Sri Lanka, Cambodia, Bangladesh, and Papa New Guinea are leading the way,” says Sandy Shen, research director in Gartner’s Shanghai office. “They also have a large number of unbanked and underbanked users and a strong commitment by service provider.”

Much will depend on whether Safaricom, which has satellite operations throughout East Africa, is able to become the first company anywhere in the world to successfully transition from being a wireless carrier with a mobile wallet to a wireless company with a full range of banking services. If that is to happen, M-Shwari will likely need to offer more favorable terms to Kenya’s poor from the slums of Nairobi to the cattle fields of the Masai Mara.

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