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We will not split Mpesa from Safaricom CEO Peter Ndegwa says

Safaricom CEO Peter Ndegwa. [Wilberforce Okwiri, Standard]

Safaricom CEO Peter Ndegwa has said that the telecommunication company will not separate Mpesa from Safaricom. 

Ndegwa who was speaking to Citizen TV’s Waihiga Mwaura on Tuesday said that the company would not follow in the footsteps of its main competitor Airtel to separate its telecommunication with the mobile money service.

He said that the company will instead create a group structure where they will have different businesses under the Public Listed Company. 

“We do intend to go into a group structure but we do not intend to spin off MPesa into a separate business,” he said.

He said that were it to happen then it would be in the interest of its customers or shareholder adding that in the absence of the two then Safaricom will wait for the time when it is required to do so.

“At this stage, we are not considering getting a banking license,” he said adding that the company will continue working with banking partners.

He said that those calling for the split for easy oversight were misled saying that Mpesa is regulated by the Central Bank while CA regulates the telecommunication side of the company, which he said has never prevented the two regulators from their regulation and oversight duties.

He denied that the success of Mpesa, which contributed 40 per cent of the company’s earnings in the last financial year, is not the reason why he is currently opposed to the separation.

Why Ethiopia 

He said that Ethiopia is the second largest country in Africa and the only country that had only one telecommunication company. 

He says the country presents an opportunity to help the company to continue with growth adding that its move will support other companies to pit camp in Ethiopia. 

He estimates that Safaricom Ethiopia will be where the Kenyan Safaricom is currently at in 12 years, adding that the consortium which is the majority shareholders had invested 1.2 billion dollars in the project and will continue pumping 300 million dollars annually.

He says that Safaricom is also looking to invest in the East African market as well but that is a long-term plan. 

The ongoing conflict is yet to affect their business rollout in the country but the sooner a deal is reached between the Ethiopian Army and the Tigray People Liberation Front the better for its growth.

“They are aware and they know about the success of Mpesa in Kenya and the region so they cannot wait to be able to get their hands on Mpesa,” he said adding that the mobile money service could be launched in the next six months.