Safaricom suspends new bank-to-third-party MPesa tariffs to December 1, 2015


In order to avoid the potential of a fallout with its banking partners, Safaricom has moved first to suspend its new rates for bank to third party MPesa accounts which took effect less than a month ago on August 1, 2015.

The revised tariffs for bank to third party MPesa transfers were communicated to banks by Safaricom’s GM for Enterprise Rita Okuthe in a letter dated July 9 this year.

The letter titled: “Change of B2C tariff for Bank to MPesa Service” stated that the “changes have risen partly in light of ongoing efforts to streamline the MPesa proposition and also partly in response to continuous efforts to ensure compliance with regulatory guidelines.”

The letter stated in part: “It has come to our attention that there has been an increase in the number of alleged incidents of erroneous and/or fraudulent transfers involving bank customers utlising the Bank to MPesa functionality offered by their various banking /financial service providers. The increase in the number of these incidents has been attributed to the fact that customers are enabled to make direct MPesa transfers to the MPesa accounts of third parties.”

As an incentive, Safaricom introduced discounted tariffs for bank to MPesa transfers to customer’s own MPesa accounts while increasing the tariffs for bank to MPesa accounts of third parties.

“In order to reduce incidents of this nature, it is our advice that you strongly consider only facilitating bank to MPesa transfers to a customer’s own MPesa account in order to discourage the occurrence of the aforementioned incidents. As an incentive, we have introduced a discounted tariff…In the event that you still prefer to facilitate third-party transfers as a service offering, then these transfers may still be pursued but subject to the revised tariff rates,” stated Ms Okuthe in the letter.

The new rates took effect on August 1, 2015.

Based on the revised rates, consumers were being charged a tariff of Kshs 55 to transfer between Kshs 2,501 to 3,500 from one’s bank account to one’s own or third-party MPesa account while transferring between Kshs 20,000 to 70,000 attracted a charge of Kshs 110. But as an incentive, moving between Kshs 50 to 1,000 from one’s own bank account to his/her MPesa account was billed at Kshs 15 with amounts ranging from Kshs 1,001 to 70,000 attracting a charge of Kshs 22.

However, seemingly due to the short period within which the tariff revision was made and communicated to partner banks with no sufficient time in between to relay the same information to clients, it is understood that Safaricom’s Rita Okuthe wrote another letter to the partner banks last Thursday August 20 informing them that the new changes had been suspended and would only be effective from December 1, 2015.

Ms Okuthe’s letter to the partner banks has been followed up by another statement issued today by Safaricom’s director of Corprate Affairs Stephen Chege.

“In line with technological advancements, a number of Banks and Financial Institutions are now using the existing M-PESA infrastructure to extend the transfer of funds from customers’ bank accounts to third party M-PESA wallets (Bank-to-Many),” states Mr Chege in the statement, adding: “This service, like any other service on our platform, will attract charges.  The charges that we will implement are similar to what applies for P2P M-PESA transactions (sending M-PESA from one customer to another).”

Chege adds that Safaricom has already received the requisite approvals from the Central Bank of Kenya, further noting that ‘this is a new service, and not a revision of any existing charges.’

“However, these charges will only come into effect on 1st December 2015. This will allow Banks and Financial Institutions ample time to communicate to their customers about the service,” he states.

Since the launch of M-PESA, Safaricom has partnered with over 30 banks and more than 160 other Financial Institutions to allow bank-to-MPesa account transfers.

According to the CA’s latest industry statistics for the period covering January-March 2015, the number of mobile money transfer subscriptions rose by 3.0 percent to reach 26.7 million up from 26.0 million subscriptions registered during the last quarter while the number of active agents grew by 3.9 percent to stand at 126,622 up from 121,924 agents recorded during the last quarter.


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