Africa, Business, invesment, Invesments, news, Uncategorized, World Bank, World Bank Group

Africa News February 14, 2014 at 10:41AM

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VENTURES AFRICA – Kenyan mobile operator Safaricom has disallowed the move by rival companies; Airtel and Essar Kenya to utilize its M-Pesa agents for their mobile phone cash transfer service, Airtel Money and yuCash respectively

M-Pesa which is a mobile money transfer and micro-financing service developed by Safaricom is termed the most successful of its type with over 18.1 million subscribers in Kenya and 78, 856 agents scattered all over the country, guaranteeing quick transactions.

According to the mobile operator, its rivals also have ample opportunity to develop their mobile cash transfer agency network.

“By growing our agency network we have demonstrated that there is ample opportunity for our rivals to recruit and invest in their own agents so as to demonstrate their commitment to creating job opportunities for young Kenyans,” Safaricom told the Business Daily.

It went on to add that it would not allow the use of its M-Pesa agency by rival companies since Safari had invested billions of shillings into its development and still keeps investing

“Safaricom invests in excess of Sh1.2 billion ($13.8 million) annually on building and maintaining its M-Pesa agency network in order to serve our customers better.”

Airtel has however reacted to this by appealing to the competition regulatory body, Competition Authority of Kenya (CAK), to take action against Safaricom’s decision to disallow the use of their M-Pesa agents by other rival companies, protesting that it is a misuse of power

This battle between the rival companies over the use of M-Pesa agents will not be the first since Airtel had previously called out Safaricom, complaining that the leading company was charging higher transaction fees for subscribers not on the M-Pesa network and insisting on delivering the M-Pesa services solely through its agents

The dispute resulted in a settlement offer even though Airtel insisted that CAK force its rival to stop restricting access to M-Pesa.

Safaricom however countered that M-Pesa was its trademarked product and the company could not be forced to give access to rival companies or punished for the success it had recorded

With Safaricom’s market share currently at 73 percent, rival companies are left to scramble for a share of the remaining 27 percent in the mobile money service which puts them in a shaky position

Also, the giant telecom’s refusal to grant access to its M-Pesa agents does not encourage inter-operations between the mobile money operators

 

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