Safaricom loses bid to limit free 1000-bob M-Pesa transactions

Safaricom has lost a bid it had made to the Central Bank of Kenya requesting a limit to the number of free below-1000-shilling transactions a customer could do in a day. The Mobile Money giant was requesting that a limit of up to five-free-transactions per day be set, as the offer was being abused by people who’d take time to make as many 1000-bob transactions as possible to avoid paying transaction fees.

According to Business Daily, the company reported to the Central Bank that people were splitting high-value transfers of up to KES. 60,000 to escape paying a transaction fee of KES. 105.

The telco also asked the Central Bank to lower the threshold of free transactions from the set KES. 1000 to KES. 500. This they said, was to help them reduce their losses of up to 1.7 Billion monthly. Both requests seemingly were denied.

Recently, the Central Bank said that the measures it had put in place earlier this year to help fight the spread of Covid-19, and also to help customers during these times, would remain in place until December 31st.

According to the Regulator, the measures have been effective, and have facilitated personal transfers at a time of great need. Mobile money transactions have increased, and there’s now over 1.5 Million new customer using mobile money.

With the extension of Central Bank’s measures, Safaricom could lose up to KES. 15 Billion.