Telcos

Telkom Kenya Makes Petition for Safaricom To Lower M-PESA Charges

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M-PESA

Telkom Kenya has begun seeking orders from the authorities though Parliament to have Safaricom cut its M-PESA fees for cash transfers to rival platforms. As reported by Business Daily, this petition is among many that have been submitted to the Senate Standing Committee on Information, Communication and Technology.

Currently, M-PESA has cheaper rates for transactions among customers compared to those charged on cross-platform deals. This is one that Telkom among others feels is uncompetitive behaviour.

The rivals argue that the company is too dominant in the market and must be controlled by regulators to avoid the collapse of its competitors. This reiterates Airtel’s plea to the same committee about having the government declare Safaricom a dominant player in the country’s telecom space.

As it stands, charges for transferring cash from M-PESA to rival mobile money platforms are up to four times higher than fees among Safaricom customers.

According to Telkom, the use of various tariffs is the main factor that has helped Safaricom dominate the mobile money market. M-PESA holds more than 90% of the market leaving Airtel Money and T-kash almost no chance or hope of ever caching up.

“Safaricom charges should be uniform for cross-platform money transfers, in line with the AM recommendation, on both USSD [SMS-based technology] and STK [SIM card-enabled] transfers,” Telkom Kenya said in its submission.

Telkom argues that the pricing strategy from Safaricom is what has helped it attract more customers and lock them in with little incentive to use alternative platforms.

Other than the pricing, the telco wishes for the regulators to take additional measures to reform Safaricom’s mobile money business.

The relevant regulators, Central Bank of Kenya (CBK), Communications Authority of Kenya (CA) and Competition Authority of Kenya (CAK) need to co-operate and co-ordinate the implementation and enforcement of agent interoperability,” the telco said.

“The CBK should set a firm deadline for full mobile money interoperability and impose financial incentives designed to ensure Safaricom co-operates in implementing agent interoperability by the specified deadline.”

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