Kenya:Treasury to formulate new rules on mobile money tax

The Star.

Feb 14,2013.

TREASURY is working on new regulations on taxing mobile money transfer services aimed at leveling the playing field for all operators.

Finance minister Njeru Githae said a ‘minimum charge per transaction’ will be introduced soon so that those companies offering money services free also get to pay tax like Safaricom.

Airtel and yuMobile have been offering money services within their platform at no charge and argue they are not liable to pay the 10 per cent tax introduced recently.

On the other hand, Githae said, Safaricom has decided to absorb the tax for small transactions of less than Sh100 putting it at an 'uncompetitive' position with the rest.

“The concern is about those offering free services [as] there is always a cost associated with transferring money. So with the minimum charge it is up to the company if it will still want to meet the cost,” Githae said yesterday.

“This will ensure one company will nor be at a disadvantage compared to the others,” the minister said on the sidelines of a public-private partnerships workshop in Nairobi.

The Finance Act 2012 introduced amendments to the Customs and Excise Duty Act which introduced a 10 per cent tax on transaction fees for all money transfer services provided by cellular phone providers, banks, money transfer agencies and other financial service providers. Treasury is targeting to collect an estimated Sh4.5 billion from the new tax.

Safaricom, which has 16 million subscribers on its M-Pesa platform, was the first to transfer the 10 per cent tax on to its customers. This saw all charges for transactions above Sh100 go up.

The other players have not changed the pricing but insist their free services should not attract any tax. Githae backtracked on earlier directive that the companies should not pass on the cost to consumers.

"We had expected the companies would absorb the cost, but you know, it is a free market and we do not want to interfere," he said.

comments powered by Disqus

Stay Connected

  • Follow us on




Unbanked Tv

Featured Companies

  • Global mobile financial services technology provider.
  • A complete mobile money solution for mobile money providers in emerging markets.
  • Serves both mobile and e-payment needs in the Nigerian market place.
  • splash is Sierra Leoneís first mobile payment system.
  • Teasy is an innovative Nigerian based mobile payment company

MobileMoney Jobs

Featured Events

  • 10-11 July,2013 Accra - Ghana.
  • AfricaCom 12-14 November 2013 CTICC Cape Town South Africa
  • May 27 -29 Hyatt Regency Johannesburg, Johannesburg, South Africa.
  • MobileMoneyExpo, LAGOS Feb 12th & 13th, 2014 Nigeria


  • B
  • Stanbic MobileMoney Agent at Shoprite
  • Stanbic MobileMoney Stand at Shoprite
  • Visit to Management of Comviva,India
  • Agency field work with FortisMM, Ibadan
  • Agency activities with FortisMobile,Ibadan
  • EazyMoney Agent training, Lagos state
  • EazyMoney Agent training, Oyo State.
  • EazyMoney Agency Training, Edo State
  • EazyMoney Agent Training
  • Group visit to Tigocash,Ghana
  • TigoCash Agent branding stand, Accra
  • TigoCash Agent outlet, Accra
  • Tariff Table, TigoCash Ghana.
  • Field work in Enugu State.
  • Agent in Enugu State.
  • Agency Field work in East of Nigeria.
  • Merchant ID
  • Splash MobileMoney Call Center Team
  • Agent group Training, Lagos
  • Agent group training, Lagos
  • Splash MobileMoney, Sierra Leone
  • Visit to Splash MobileMoney, Sierra Leone.