Airtel money and M-pesa drama

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  • 3 years ago
  • Posted: December 3, 2015 at 12:10 pm

Airtel money and M-pesa offer the same services and to their advantage the target market is huge. Airtel has started yet another drama after they found out that Safaricom is coercing their agents to remove Airtel brands from their shops. I think that’s a reflex action. It’s weird when two rivals share the same shop to sell stuff. However, sometimes back Safaricom and Airtel came up with an agreement on how they can carryout their business peacefully, well, that agreement has been breached.

To threaten Safaricom, Airtel’s lawyers Mukite Musangi Advocates wrote to Safaricom accusing them of forcefully compelling it’s M-pesa agents to remove Airtel branding from their shops and stopping offering Airtel Money services failure to which they would have their M-Pesa tills disconnected.

Airtel raised a blow against the settlement that the two firms entered with the Competition Authority of Kenya. The two were supposed to do away with exclusivity and allow M-pesa agents to offer Airtel money and M-pesa services freely. On the other hand, Safaricom claimed that they are clean and they have not ordered their agents to deface Airtel.

“We have not issued any directives to our agents or dealers to remove or alter any branding in their shops. Without any evidence these claims amount to unsubstantiated allegations and a smear campaign against Safaricom,” said Stephen Chege, director of corporate affairs at Safaricom. “In fact, we are currently involved in a court case with Airtel as they had previously pulled down Safaricom’s branding and were illegally using our M-Pesa logo without our consent.”

The service providers had agreed to allow investors run M-Pesa services with rivals such as Airtel Money and Orange Money in the same shop.

Many people are benefiting from mobile money business. The Communications Authority of Kenya recently released a report claiming that transactions carried out through mobile phones rose by 24.7 per cent to Sh2.37 trillion in 2014 compared to Sh1.9 trillion that was transacted through the same channel in 2013. In addition, the number of active mobile money transfer agents increased to 129,357 from 126,622. In the same report, Airtel lost 3.5 per cent of its Airtel Money subscribers to stand at 3,122,519 – now I get where the drama originated from.

M-pesa has a massive number of customers which intimidates other service providers like Airtel Money. With the increased number of agents, customers find it easy to send and receive money using their phones. Statistically, Airtel has three million mobile money subscribers and 9,857 agents, while Orange has 192,531 subscribers with 15,984 agents.

Safaricom prides of its success and would like Airtel to kill their accusations. However, Business Daily reports, Airtel wants Safaricom’s pricing of its M-Pesa services investigated, arguing that its hire charges for money transfers to and from rival platforms is anti-competitive and Safaricom’s mobile money agents account for about 88 per cent of the entire telecoms industry hence most transactions take place on its network denying Kenyans choice by charging those outside its network double the costs.

Airtel money and M-pesa have an obligation to have a continued growth and economic efficiency to promote sustainable growth.

 

What is your opinion on the topic?
Erick Vateta
Tech Editor at Kachwanya.com
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Erick Vateta is a lawyer by training, poet, script and creative writer by talent, a model, and tech enthusiast. He covers International tech trends, data security and cyber attacks.
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