In what observers say is part of strategy to appeal to more customers after Senators mull breaking up the giant telecoms company for fear of growing into a monopoly, Safaricom plans to reduce M-Pesa transaction fees, after complaints over the imposition of free M-Pesa for deals of up to Sh 1,000. The company says this is part of its plan to retain the higher business volumes that followed the change in strategy. Safaricom CEO, Peter Ndegwa confirmed this, saying “We intend to reduce our transaction costs over time. How quickly we do that is something we want to judge but certainly, we haven’t made a decision yet at this stage.”
It could be recalled that Senators in Kenya believe that Safaricom should split into two firms – Mobile Services and M-PESA. According to The Star, a split would see the mobile telephony service regulated by the Communication Authority of Kenya (CAK) and the M-Pesa division regulated by the Central Bank of Kenya (CBK). The Senators believe there should be a level playing ground for the likes of Telkom and Airtel Kenya who operate at the mercy of Safaricom as they owe it billions of shillings.
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“The market is not competitive any more. The other operators should be allowed to operate, by giving the dominant operator its right, but also allowing the others to operate, and allow innovation in the country,” says Senator Petronilla Were of the ICT committee. Senator Irungu Kang’ata echoed this sentiment, saying “in Kenya, you have a situation where one single player dictates how much you are going to pay for data bundles, for calls and Short Message Service because it controls almost 90 per cent of the market”.
“In such a situation, I do not foresee any other entity growing. We are not going to create more jobs and innovation in that industry because of the dominance of one entity.”
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Senator Enock Wambua urged Safaricom to confirm whether it is a communication company or a banking institution. “I would suggest that Safaricom is split into two. Safaricom the communication company, regulated by the Communication Authority of Kenya (CAK), and the M-Pesa division regulated by the Central Bank of Kenya.”
Kelechi Deca
Kelechi Deca has over two decades of media experience, he has traveled to over 77 countries reporting on multilateral development institutions, international business, trade, travels, culture, and diplomacy. He is also a petrol head with in-depth knowledge of automobiles and the auto industry