Tangaza has now become the first mobile money service in Kenya to have its licence revoked by the Central Bank of Kenya (CBK). As reported by Nation, the company has had its operations cancelled over what the regulator describes as “continued violations of the National Payment System (NPS) regulations.”This includes the failure to submit audit reports. According to the CBK, the firm’s business will be taken over by the financial regulator.
“Pursuant to Regulation 10(5)(b), CBK has taken over control of the business of MPL to safeguard and facilitate distribution of the money in the Trust Fund,” said CBK in a statement.
“This action culminates a long engagement between CBK and MPL (Mobile Pay Limited), during which CBK has considered MPL’s continued violations of NPS law and regulations.”
Launched back in 2011, Tangaza was Kenya’s first non-telecom firm to enter the mobile money industry in a bid to rival Safaricom’s M-PESA. However, it’s safe to say that the firm didn’t get to attract as many Kenyans over the years grabbing only 0.01% of the market share.
But it seems that the company’s leadership went ahead to not comply with various financial laws, an offence that has now caught up with them.
“While MPL was granted sufficient time to address its violations, its compliance has continued to deteriorate, putting customer funds at risk,” reads the statement from CBK.
The CBK states that it will undertake a reconciliation of the MPL customers’ balances against the Trust Fund accounts. This will then open the way for the regulator to reimburse the customers. This is expected to be completed within two weeks.