Why Every Kenyan Business Needs This Integration

Running a business in Kenya means dealing with M-PESA transactions daily. But how do you ensure every payment is automatically recorded, reconciled, and tracked in your accounting system? Imagine an automated system where every M-PESA transaction is recorded instantly into your accounting software without manual entry.

That’s where Zoho Books and M-PESA integration comes in. Instead of manually updating your records, this integration ensures real-time payment tracking, reducing errors and saving time.

In this guide, we’ll break down every step in detail. Whether you run an eCommerce store, a service-based business, or a consultancy, this solution is a game-changer!

Why Integrate Zoho Books with M-PESA?

Most businesses in Kenya already use M-PESA for transactions, but without an automated system, they face challenges like:

• Manual recording of payments, which is time-consuming.
• Errors in bookkeeping, leading to financial mismanagement.
• Delayed reconciliations, making cash flow tracking difficult.

By integrating M-PESA with Zoho Books, you eliminate these issues and unlock powerful business benefits:

1. Instant Payment Recording

Every time a customer pays via M-PESA, the transaction is automatically captured in Zoho Books—no more manual data entry!

• Eliminates missing or delayed payment records
• Ensures real-time updates in your accounting system
• Saves hours of bookkeeping work each month

2. Automated Invoice Payments

With M-PESA linked to Zoho Books, customers can pay invoices instantly. You don’t have to chase payments manually.

• Customers receive an invoice with an M-PESA payment option
• Once paid, Zoho Books auto-updates the invoice status
• Reduces unpaid invoices & improves cash flow management

3. Faster Bank Reconciliation

Matching M-PESA payments to invoices manually is exhausting. With this integration, it happens automatically.

• Syncs M-PESA transactions directly with Zoho Books & your bank
• Reduces errors in financial reporting
• Ensures a clear overview of income & expenses

4. Better Financial Reporting & Insights

You’ll get instant access to detailed reports, giving you a real-time view of your cash flow.

• View all M-PESA transactions in one place
• Generate profit & loss statements with real-time data
• Make better business decisions based on accurate financial reports

5. Enhanced Customer Experience

M-PESA is Kenya’s most popular payment method—by integrating it, you make it easier for customers to pay.

• Accepts payments instantly via mobile
• Builds trust & credibility with customers
• Speeds up transactions, improving customer satisfaction

How to Integrate M-PESA with Zoho Books (Step-by-Step Guide)

Now, let’s walk through the exact process of setting up M-PESA inside Zoho Books. Follow these steps carefully for a smooth integration!

Step 1: Register on Safaricom’s Daraja Portal (Get API Credentials)

To link Zoho Books with M-PESA, you need to create an application on Safaricom's Daraja portal to obtain the necessary API credentials.

1. Access the Daraja Portal:

Navigate to the Daraja 2.0 website.

2. Sign Up or Log In:

• If you already have an account, click on "LOGIN" and enter your credentials.
• For new users, click on "SIGN UP" and follow the registration process.

3. Create a New Application:

• Once logged in, go to the "My Apps" section.
• Click on "CREATE NEW APP".
• Provide a name for your application.
• Check the box next to "Lipa Na M-PESA Sandbox" to select the appropriate API product.
• Click "CREATE APP" to generate your application.

4. Retrieve Your Credentials:

• After creating the app, you'll be provided with a Consumer Key and Consumer Secret.
• To take your app live, navigate to the "GO LIVE" tab.
• Fill in the required fields; a Pass Key will be generated and sent to your registered email.

Keep these credentials secure, as they are essential for configuring the integration in Zoho Books.

Step 2: Configure M-PESA in Zoho Books

With your Daraja API credentials in hand, proceed to set up the M-PESA integration within Zoho Books:

1. Log in to Zoho Books:

Access your account at Zoho Books.

2. Navigate to Payment Gateways:

• Click on the gear icon (Settings) in the top-right corner.
• Select "Online Payments" from the dropdown menu.
• Click on "Payment Gateways".

3. Set Up M-PESA:

• In the list of available payment gateways, find "Safaricom M-PESA" and click on "Set Up Now".

Enter the following details:

1. Business Short Code: This is provided by Safaricom upon registration.
2. Consumer Key and Consumer Secret: Obtained from the Daraja portal.
3. Pass Key: Received via email during the app creation process.

• Link your business bank account to facilitate seamless transactions.
• Click "Save" to activate the integration.

This setup enables Zoho Books to communicate directly with M-PESA, allowing for automated payment processing and recording.

Step 3: Enable M-PESA Payments on Invoices

To offer M-PESA as a payment option to your customers:

1. Create or Edit an Invoice:

• In Zoho Books, navigate to the "Sales" module and select "Invoices".
• Click on "New Invoice" to create a new one or select an existing invoice to edit.

2. Configure Payment Options:

• Within the invoice, locate the "Payment Options" section.
• Check the box for "M-PESA" to enable it as a payment method.

3. Save and Send the Invoice:

• After configuring the payment options, click "Save".
• Send the invoice to your customer via email or SMS directly from Zoho Books.

Customers will now see M-PESA as a payment option on their invoices, allowing for quick and convenient payments.

How Customers Can Pay via M-PESA

When a customer receives an invoice with M-PESA as a payment option:

1. Access the Invoice: The customer opens the invoice link sent to their email or SMS.

2. Select M-PESA as Payment Method: Within the invoice, they choose M-PESA as their preferred payment option.

3. Enter Payment Details:

• The customer provides their M-PESA registered phone number.
• They confirm the payment on their mobile device using their M-PESA PIN.

Once the payment is completed, it is instantly recorded in Zoho Books, updating the invoice status automatically.

🚀 No more manual updates! Your books stay accurate in real-time.

🔹 Troubleshooting Common Issues

🔴 Issue: Payments Not Reflecting in Zoho Books
✅ Solution: Double-check your Short Code, API Keys, and Pass Key for accuracy.

🔴 Issue: Customers Can’t Make Payments
✅ Solution: Ensure your M-PESA Paybill number is active and correctly configured.

🔴 Issue: API Authentication Errors
✅ Solution: Generate new API credentials in the Daraja Portal and update them in Zoho Books.

Why This Integration is a Game-Changer for Kenyan Businesses

Perfect for SMEs, freelancers, & eCommerce businesses – Say goodbye to manual data entry!
⚡ Fast & secure transactions – Reduce payment delays & streamline finances.
Detailed financial insights – Get real-time reports on M-PESA transactions.

Need Expert Help Setting Up Zoho Books & M-PESA?

Spondoo Kenya can assist you with professional setup & support.

📢 Don’t wait! Set up your Zoho Books & M-PESA integration today and experience effortless financial management.

💬 Have questions? Drop a comment below, and let’s discuss! Book a consultation today!