Kenyan mobile operators call for a clearing house for mobile payment transfers

Mergers, Acquisitions and Financial Results

Kenya's smaller mobile networks want the country's Central Bank to set up a centralised clearing house for mobile payment transfers - in a deliberate attempt to reduce the dominance of Safaricom's M-Pesa platform.

The networks argue in a letter sent to the Prime Minister that inter-network transfers are currently too expensive and that a central clearing house would lower the costs - and make it easier for Safaricom customers to switch to an alternative mobile network.

Currently, the cost of sending funds from M-Pesa to a customer on a rival network costs Sh400 for a Sh25,000 transaction - about double what Airtel charges for a similar service on its own mobile money platform.

Currently transactions between networks still rely on the recipient being sent an SMS and them having to visit a money agent to collect the cash. Under the proposal, the money would be transferred electronically between accounts as happens with transfers between customers on the same network.