The emergency waivers for mobile money transactions given to operators in Kenya for mobile money operators by the Central Bank of Kenya will expire on December 31, 2020. The apex bank said the measures established on March 16st 2020, to encourage mobile money transfer over cash transactions in response to COVID-19 will end, following consultations with Payment Service Providers. To this end, from January 1 2021, PSPs will end the charges waiver for transactions below KSh 1000, replacing it with zero rated fees for transactions below Ksh 100. However, waivers for transfers between mobile money wallets and bank accounts will remain.

Additionally, CBK will oversee charges between Savings and Credit Societies (SACCOs) and mobile money platforms in an attempt to integrate the societies with mobile money. Payment Service Providers will also offer revised pricing structures pegged on choice, efficiency, transparency, affordability, and customer-centricity, among other tenets. Safaricom announced that it is considering reducing its transaction costs over time.

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The waivers boosted mobile money usage and brought in new users to the services. CBK says the monthly volume of person to person transactions increased by 87% between February and October 2020. Similarly, the volume of transactions below Ksh 1000 hiked by 114%. Mobile money also recorded 2.8 million new users over the period. Nevertheless, service providers bore the brunt, forfeiting fees, and commissions for the transactions. For instance, M-Pesa revenue declined by 14.5% year on year, following the waivers in response to COVID-19.

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“The adverse service revenue performance is mainly attributed to the decline in M-PESA and voice revenues. Zero-rating of M-PESA transactions impacted M-PESA revenue which declined 14.5% year-on-year,” said Michael Joseph, Chairman of Safaricom Plc Board of Directors.

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