Connecting Africa is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 3099067.

FinTech

Kenya High Court suspends mobile money fees

Article Image
The Kenyan High Court has suspended charges for sending money between mobile money wallets and bank accounts.

The suspension is pending the determination of a lawsuit involving financial consumer rights after a petition was filed with the court by Kenyan citizen Moses Wafula claiming that charges should not be passed on to consumers.

The ruling halts the reintroduction of charges between mobile money wallets and bank transactions, that were supposed to begin on January 1, 2023, after the Central Bank of Kenya announced the reinstatement of fees in December.

According to local publication Business Daily, Wafula asked the court to find that Safaricom's M-Pesa Paybill charges were illegal and that it is in contravention of the law for the banks to continue riding on the M-Pesa Paybill infrastructure and making money from the public.

The M-Pesa Paybill is a cash collection service that allows organizations like banks, government agencies, Kenya Power, DSTV, betting companies, mobile money companies and other institutions to collect money on a regular basis from their customers through M-Pesa.

Wafula argued that charges from M-Pesa Paybill services should be paid for by Safaricom's primary clients, not consumers.

Fees waiver

When the COVID-19 pandemic hit the world, governments across Africa urged citizens to avoid physical cash and to use mobile money services instead to help stem the spread of the virus.

As part of the emergency measures to facilitate the use of mobile money at the height of the pandemic, consumers were given a reprieve on fees. Central banks instructed operators to reduce or waive fees to encourage citizens to use their mobile money services rather than cash.

However, in some countries, mobile operators brought back mobile money transfer fees as early as June 2020. Some operators removed the reprieve after the 90-day person-to-person (P2P) transaction-free periods ended.


Want to know more about mobile financial services in Africa? Check out our dedicated Fintech content channel here on Connecting Africa.


In Kenya, charges for sending money between mobile money wallets and bank accounts were supposed to have returned this year, but have been suspended pending the court case.

Wafula told the court that Safaricom has no authority to charge members of the public for a service offered to its contracting service recipients including banks. The matter will be back in court on January 23.

Related posts:

*Top image source: Image by Racool_studio on Freepik.

— Matshepo Sehloho, Associate Editor, Connecting Africa

Innovation hub

Video

Interview: Qualcomm execs on mentorship for African startups

Qualcomm Technology VP for Engineering, Sudeepto Roy, and Elizabeth Migwalla, VP for Government Affairs, join Connecting Africa for a video interview about Qualcomm's Make in Africa Mentorship Program.

Story

Hot startup of the month: Pan-African fintech KamaPay

This month's hot startup is pan-African fintech KamaPay, which helps individuals and businesses make cross-border payments on the continent.

More Innovation hub

Latest video

More videos

Sponsored video

More videos

Industry announcements

More Industry announcements

Flash poll

All polls

Africa Tech Perspectives

Story

Deep dive into East Africa's tech startup ecosystem

New survey reveals a lack of access to investors, reliance on international VCs and global recession trends as the biggest barriers for East African tech startups to access funds.

Story

Challenges and opportunities for women's tech careers

A new survey reveals that COVID-19, the cost-of-living crisis, skills shortages and a lack of mentorship have negatively affected women's career development over the past two years.

Story

Survey: Opportunities for Women in Tech

Take our new survey for women across Asia, Europe and Africa looking at the biggest challenges and opportunities for women-led enterprises and trends in tech careers for women.

More AfricaCom perspectives

Upcoming events

London Tech Week
June 13-16, 2023
Queen Elizabeth II Centre, Broad Sanctuary, London SW1P 3EE
Cybertech Africa 2023
August 1-2, 2023
Kigali Convention Center, Kigali, Rwanda
Africa Tech Festival, Home of AfricaCom and AfricaTech
November 13-16, 2023
CTICC, Cape Town
More Upcoming events

Guest Perspectives

Story

Omdia View: February 2023

By Omdia Analysts

In February 2023 key events in the Middle East and Africa included a major Internet project for Africa's underserved by Liquid Intelligent Technologies and Microsoft as well as a 5G launch in Tanzania – that and more in this month's Omdia View.

Story

Omdia View: July 2022

By Omdia Analysts

Kenya and Zambia move towards 5G with new spectrum allocations while Tunisie Telecom plans to shut down its 3G network - that and more in this month's Omdia View.

More Guest Perspectives

Partner perspectives

All Partner Perspectives

Like us on Facebook

Newsletter Sign Up


Sign Up