Kenyan operator Safaricom expects to be able to end Covid-related price cuts at its M-Pesa business at the end of the year, Reuters reported. Safaricom CEO Peter Ndegwa told the news agency that it has seen nothing that says it should be longer. Safaricom’s core first-half earnings dropped 10.5 percent year on year, hit by a 14.5 percent decline in M-Pesa revenue.
Ndegwa said talks with the central bank are continuing and that the company may yet cut prices for some M-Pesa services after volumes rose significantly during the pandemic.
M-Pesa is one of the most popular modes of payment in Kenya. At the end September it had nearly 27 million active users in a population of 47 million. Safaricom removed all charges on small peer-to-peer transfers in March to facilitate cashless payments during the Covid-19 pandemic. The move was ordered by the central bank, which also directed commercial banks to remove charges on customers’ cash transfers to mobile wallets until the end of the year.
Safaricom has also been focusing on its data business to offset the M-Pesa revenue drop, offering 60,000 customers financing to buy 4G phones in an effort to boost usage. The company aims to increase the proportion of smartphones on its network to 70 percent over time, from current penetration of less than 20 percent. It is also expanding its 4G network to cover all of the country by the end of this year, from 90 percent coverage in October.
Safaricom is bidding in a consortium with Vodafone and Vodacom for one of two mobile phone operator licences on offer in Ethiopia and will hold 51 percent of the new operator if its bid is successful, Ndegwa said.
