
Calls for the teleco giant Safaricom to be split into different entities have started once again. Proponents for the split of East and Central Africa’s most profitable company want it to be divided into two entities.
One entity is to exclusively deal with voice, data and SMS services under the supervision of Communications Authority of Kenya (CA). The other entity is to be registered as a financial institution to deal with its flagship invention M-Pesa.
The idea first came to the fore in 2020 when Gem MP Elisha Odhiambo introduced a bill to parliament, (Kenya Information and Communications Amendment Bill) where they sought to separate the Teleco sides of the companies and their financial sides. The bill didn’t sail through after only two of the 349 MPs approved it to move the bill to the next stage.
It was a bill designed such that all players in the industry with Airtel and Telkom also expected to split their operations, but the biggest casualty would have been Safaricom which enjoys a very huge market share as compared to its competitors.
Safaricom controlling 63.5% of the market, it is seen to be a monopoly in the market although Airtel is really improving its market share at 27% , Telkom comes a distant third at 6% with the remaining telecos Finserve Africa and Jamii Telcom all being below 3%.
Previous attempts to split the teleco companies have always hit a snag. The latest attempt has been by Dagoretti South MP John Kiarie, who during a session with the central bank of kenya (CBK) Governor Patrick Njoroge at the induction workshop for parliamentarians, asked the CBK to help them formulate policies that will regulate the industry.

It has been established that some telecos are using the lack of regulations by the Central bank to exploit their customers with astronomical interest rates on overdraft services like Safaricom’s Fuliza.
M-Pesa has grown to become the highest revenue earner for Safaricom PLC and experts even deduce that should the company split into two entities, M-Pesa will still be a force to reckon in the Fintech industry with analysts at Genghis Capital estimating its value to be somewhere around KES 650 billion. This places it way beyond its would be competitors like Flutterwave, Opay, Wave, Interswitch and Fawry.
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