Saturday, August 22, 2020

How Smart Kenyans Want To Kill M-Pesa

    August 22, 2020   No comments

Mpesa

Safaricom which owns Mpesa have already reported a decline in the amount of profits the company made as a result of Mpesa profits falling.

Within the last three months Safaricom lost more than ksh 5 billion after the Central Bank of Kenya (CBK) announced a few measures to cushion Kenyans from the COVID-19 negative economic impact. 

CBK announced the removal of any transaction charges involved when a customer transfers cash from Mpesa to bank or from bank to Mpesa. In addition the bank regulator directed that Mpesa and other mobile money wallets never to charge fees for transfer of any amount below ksh 1000 and this is where the smart Kenyans came in to take advantage of this.

Smart Kenyans knowing that it is free sending sh 1000 ,the guys started splitting any money above one thousand into deals below ksh 1000 ,then sending in bits to avoid charges. For example someone who wanted to send ksh 5000 to a friend would send ksh 1000 five times. 

Safaricom noticed this from data collected within the past three months. It is one of reasons why the company profits fell. Smart Kenyans sent up to ksh 60,000 free of charge by splitting the amount into bits of ksh 1000 before sending. This is how these Smart people want to kill M-Pesa. 

In this regard, Safaricom approached CBK to check into this where the telecommunications company was suggesting capping the times one can send money to the same recipient to 5 but CBK declined. 

Safaricom however believes CBK will re-evaluate this move and come up with the right one to keep Mpesa back in bus5as usual.

The smart Kenyans splitting cash before sending to friends and family are projected to cost Mpesa a total of around ksh 15.3 billion. 
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Mwabaya Katana

About Mwabaya Katana

Mwabaya Katana is a Finance Online Researcher and Writer.He is the founder of 'Loans Kenya' Blog.

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