Safaricom has lowered M-Pesa charges in a move expected to affect more than 90 per cent of customer transactions.
Starting January 1 next year, the charges imposed on M-Pesa cash transfers between Sh101 and Sh500 will be Sh6, with Sh12 levied for sending money between Sh501 and Sh1,000.
This is a reduction from Sh27 and Sh28, respectively, which was charged before a waiver on M-Pesa charges for transactions of Sh1,000 and below that was effected in March.
All transactions of Sh100 and below will remain free.
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“As guided by the Central Bank of Kenya (CBK), and taking into account the principles on the pricing of mobile money services, we have taken the decision to reduce our M-Pesa tariffs by up to 45 per cent for lower value transaction bands,” said Safaricom Chief Executive Peter Ndegwa in a statement yesterday.
“This is in consideration of the expiry of the period for the zero-rated M-Pesa transactions and the ongoing Covid-19 and economic circumstances.”
Soon after the first Covid-19 case was announced in the country, Safaricom through a directive from CBK waived fees for M-Pesa transactions below Sh1,000 in what was aimed at cushioning customers from the effects of the pandemic.
The initiative was further meant to deepen mobile money usage and reduce the risk of spreading the virus through the physical handling of cash.
“Our regulator, the CBK under the leadership of Patrick Njoroge has been instrumental in the formulation of this and other measures across the financial sector, which have resulted in significant gains in the form of the ongoing economic recovery,” said Ndegwa.
The reduction cuts across the board, with those sending between Sh50,001 and Sh150,000 now paying Sh105, down from a previous Sh300.
Additionally, all M-Pesa customers will continue to enjoy free transactions between M-Pesa and their banks.
Last week, CBK announced that the suspension of money transfer fees would end on December 31.
It was supposed to be good news for payment service providers, particularly telecommunications companies such as Safaricom and Airtel.
The end of the waivers coincides with the removal of tax relief on salaries as well as value-added tax on goods and services, which were introduced by the State in April to cushion citizens against Covid-19.
“The price cuts are permanent and will enable our more than 26.8 million customers to continue enjoying lower costs whenever they send money,” Ndegwa said.
“The reduced tariffs will equally apply to transactions for micro-businesses under our new Pochi La Biashara service, and for Lipa Na M-Pesa businesses using the transacting till to make payments.”
Additionally, Sh300,000 remains the maximum amount customer can transact daily or hold in an M-Pesa account.