Safaricom’s hold on Kenyan fintech, via its mobile money platform, M-Pesa, is one that is well known. And it looks like this dominance is about to take a new dimension in the foreseeable future, going by an announcement the telco recently made.
This new move looks set to basically make a mobile money service that already accounts for around 99 percent of such transactions in Kenya into something that is even more attractive.
The new gist is that Safaricom has, as of this week, pronounced a reduction in M-Pesa transaction fees which is to take effect in the new year, from the 1st of January.
The new charge would begin the very next day after the discontinuation of the ongoing free transaction offer on amounts below KES 1 K, as recommended by the Central Bank of Kenya (CBK), which has been on for several months since the pandemic hit Kenya.
Now, M-Pesa’s tariff is set to be reduced by up to 45 percent, and this will rub off on more than 90 percent of all customer’s transactions. (View all the revised transaction fees here ). This new Safaricom disclosure didn’t just pop out of nowhere, though, as the telecoms giant has previously murmured its consideration for this move.
Sometime in November, after the release of Safaricom’s half-year financial result, the mobile operator was rumored to be toying with the idea of lowering transaction charges in M-Pesa.
The disclosure by Safaricom also followed CBK’s earlier announcement and reiteration that the offer of free transfers transfer for transactions below KES 1 K, will not end until after December 31st. It took a pandemic
For years, M-Pesa’s transaction fees have been thought to be quite high despite its ubiquitousness in Kenya. And for customers, this has always been a huge concern even though they have all had little choice but to stick with the service. As it is, it took a pandemic and CBK’s prior move for Safaricom to adjust the steep pricing.
As Peter Ndegwa, the CEO of Safaricom, said in the announcement: “As guided by the Central Bank of Kenya (CBK), and taking into account the principles on the pricing of mobile money services, we have taken the decision to reduce our M-Pesa tariffs by up to 45 percent for lower value transaction bands,” said Safaricom Chief Executive Peter Ndegwa in a statement yesterday.
He further said, “This is in consideration of the expiry of the period […]
