Safaricom has now suspended the increased rates introduced for Equity Bank’s ‘Equitel Mobile Money Transfer Service customers that came into effect on 1st August 2015 and has also confirmed that the revised rates will now take effect at the same time for all banks.
In a letter dated 25th August 2015, Rita Okuthe – Safaricom’s Director of Enterprise Unit wrote, “We are cognizant of the fact that we had implemented the new tariff for banks utilizing the ‘Additional Feature’ (meaning the transfer of money from a bank account to third-party M-Pesa customer) and shall revert back to the previous tariff’s effective 25th August 2015. The tariffs in force prior to 1st August 2015 shall continue to apply until 30 November 2015.”
The telecommunication company also distanced itself from the introduction of the transfer of money from customers’ bank accounts to third-party M-Pesa wallets -which it now refers to as the “Additional Feature.”
“Safaricom introduced the bank to M-pesa functionality primarily to enable customers’ access their bank accounts from their mobile phone. However, some financial institutions later introduced a new transaction arrangement that enabled their customers to send money from their bank accounts to the M-pesa accounts of third parties (the “Additional Feature”),” wrote Rita Okuthe.
On 1st of August 2015, Safaricom effected tariff changes for 3rd party transactions for Equitel which had increased on a graduated scale from KES 22 for amounts falling between KES 50 and KES 1,000, KES 75 for customers sending KES 5001 to KES 7500 to a high of KES 110 for amounts between KES 20,001 and KES 70,000.
However, the telecommunication company has now reverted to charging a flat rate of Ksh33 to Equitel customers till 30th November 2015 when revised charges will apply to all financial institutions.
It is expected that from 1st December 2015, customers transferring cash from any bank account to third party M-Pesa accounts will incur additional costs for amounts exceeding Sh1, 500. Safaricom has, for example, upped charges by 266.6% to KES 121 from KES 33 for those transferring KES 35, 000.
Those moving KES 70, 000 from their bank accounts to M-Pesa will incur additional KES 77 which is a 233.3% increase.
Equity Bank had earlier written officially to Central Bank of Kenya objecting the increased charges by Safaricom terming the move as not only a discouragement to the adoption of viable alternatives but also a threat to ‘the deepening financial inclusion’ in the country.
At the same time Equity Bank confirmed that money transfer from one mobile phone or bank account to another within the Equity ecosystem still attracts ZERO charges.
Equitel subscribers sending money to another mobile network are charged at 1% of the transaction amount up to a maximum charge of KES 25.