Banks Resume Charges for Transactions Above Sh100 via Mobile Money Wallets
The Central Bank of Kenya has given banks a green light to start charging customers for transactions above Sh100 using their own mobile money wallets.
In a statement sent out to newsrooms on Thursday, the regulator said the charges will target transactions linked to a customer’s bank account and savings and credit cooperative (SACCO) account such as purchasing electricity tokens, airtime, cash transfers and other payments.
The financial institutions have not been charging customers for any cash transfers between their mobile money wallets and SACCO accounts since December 17, 2020, in a deal reached between CBK and Payment Service Providers.
The regulator noted that it was forced to review the deal after observation that the SACCO sector is deeply integrated into these wallets and accounts for a significant share of their transactions, further concluding that the zero-charge price regime would hurt viability of the services given the inability to cover the underlying costs.
“This is a significant risk for SACCOs and their extensive membership due to the lack of other alternatives to connect to the mobile money ecosystem,” said CBK.
“The resumption of charges will provide space to increase the connection options for SACCOs.”
The resumption of the charges will be subject to review by CBK against the pricing principles announced on December 17, 2020, of customer centricity, transparency and disclosure, fairness and equity, choice and competition and affordability.