Mobile Money in Kenya – Safaricom Agrees to Devest

Safaricom together with Vodacom launched MPesa over a decade ago and so became the most successful mobile money service globally, but for some time the authorities in Kenya have tried to get Safaricom to split its interests. Now the Central Bank of Kenya (CBK) with its unrelenting push for “customer-centric policies”, has forced Safaricom to agree to split the company and to share merchants and agents with rivals. The company is preparing to form a holding company to house connectivity, mobile money, tower, and its Ethiopian businesses as subsidiaries. CBK has also forced both Airtel and Telkom to separate their voice and data businesses from their mobile money transfer and lending units. Airtel last week announced that it had formed Airtel Money Kenya Limited becoming the first telco to split its business. This is an interesting case of a central bank acting as a Competition Commission.

Meanwhile, Airtel Africa PLC said its Kenyan unit, Airtel Kenya Networks Ltd, has acquired an additional 60 MHz spectrum from the Communications Authority of Kenya. According to a corporate disclosure filed with the Nigerian Exchange where Airtel Africa PLC trades its shares, the newly purchased spectrum is in the 2600 MHz band. The company disclosed that it paid $40m for the new license. The newly acquired spectrum will facilitate Airtel’s effort to expand its 4G coverage across Kenya and support the telco’s future plans to roll out 5G network there.