Connect with us

Hi, what are you looking for?

Capital Business
Capital Business

Kenya

Safaricom rolls up sleeves for battle

NAIROBI, Kenya Sep 30 – Safaricom has rolled up its sleeves to battle with competing mobile phone companies, in light of the recent price wars where calling rates and SMS charges have reduced drastically amongst all players.

Chief Executive Officer Michael Joseph said the situation in the market had moved from merely focusing on pricing for calls but a battle for dominance in the mobile industry.

"It is not really a price war; it\’s a total war, which Safaricom intends to win not by an inch, or a foot but by a long mile," Mr Joseph said.

Safaricom\’s dominance in the mobile industry has come under pressure by the entrance of Bharti Airtel, Zain Africa\’s new shareholders, who have made it clear they are out to attain leadership in the next three to four years.

The Communications Commission of Kenya\’s (CCK) decision to issue new guidelines that require operators to lower their interconnection rates from Sh4.42 per minute to the current Sh2.21 sparked a bitter price war that saw mobile operators reduce calling rates to as low as Sh1 to woo new subscribers.

However, Mr Joseph said Safaricom would strive to remain as market leader in the data segment, with its money transfer service M-Pesa remaining its most formidable weapon.

"M-Pesa has become more than just a marketing tool for us but in providing services to our subscribers conveniently," he said.

Close to 300 companies have partnered with Safarciom to settle bills via M-Pesa and Mr Joseph revealed that they were in talks with the Central Bank of Kenya (CBK) for permission to increase the money transfer limits on M-Pesa, which is currently capped at Sh35,000 per transaction.

"We want to take the maximum amount you can transact to Sh50,000 and also lower the minimum amount, but all that is subject to CBK approval," he said without giving a clear timeline on when that would happen.

Advertisement. Scroll to continue reading.

Adoption of mobile banking has been taking root in the country as it is seen to speed up access to financial services and reach the un-banked population.

In May, Safaricom and Equity Bank launched M-Kesho a mobile banking service that has so far opened up over 658,057 M-Kesho accounts helping to mobilise over Sh177.8 million in new deposits. The partnership has also seen M-Pesa subscribers grow to 13 million.

"We are moving close to €150 million (Sh16.5 billion) a day, that\’s an incredible amount of money. We are moving more money in a month than what Western Union does," he said.

He was speaking during the signing of a partnership with Sarova Hotels offering guests the option of settling bills through M-Pesa. This makes Sarova the first hotel chain to implement m-commerce in its operations.

Guests will be allowed two maximum transactions a day meaning they can pay a maximum of Sh70,000.
 

Click to comment
Advertisement

More on Capital Business

Executive Lifestyle

NAIROBI, Kenya, Mar 12 – The country’s super wealthy individuals are increasing their holding of bonds, gold and cash, a new report by Knight...

Ask Kirubi

NAIROBI, Kenya, Mar 9 – Businessman and industrialist Dr. Chris Kirubi has urged members of the public to exercise extreme caution when making any...

Ask Kirubi

NAIROBI, Kenya, Mar 24 – Businessman and industrialist Dr. Chris Kirubi is set to own half of Centum Investment Company PLC, following a go-ahead...

Ask Kirubi

It is without a doubt that the COVID-19 pandemic has caught the whole world by surprise. Although its full impact is yet to be...

Headlines

NAIROBI, Kenya, Mar 18 – Commercial Banks have been ordered to provide relief to borrowers on their personal loans, with loans eligible from March...

Kenya

NAIROBI, Kenya, Jun17 – Kenya’s tea leaves manufacturer Kericho Gold, has been awarded the Superbrands Seal by Superbrands East Africa for their quality variety...

Coronavirus

NAIROBI, Kenya, Apr 13 – As the local telecommunications industry gears up to roll out 5G networks in the country, the Communications Authority of...

Coronavirus

NAIROBI, Kenya, Mar 22 – Airtel Kenya is offering free internet access for students in order to enable continued learning at home in the...