Equity protests rise in M-Pesa charges

In a letter dated August 28 and addressed to Central Bank Governor Patrick Njoroge, the lender asked for intervention on the tariff changes that it deems illegal.

Equity chief executive James Mwangi, in the letter, said the new changes were both “unjustifiable" and "unconstitutional.”

“Whereas we do not contest the right by Safaricom to vary the prevailing tariffs, we are disturbed by the timing and reasons ascribed to the variation and believe the outcome of the variation is in violation of the law. This calls for your intervention,” Mr Mwangi said.

Safaricom raised its tariffs for money transfers from all bank accounts into third-party M-Pesa accounts, promoting the option of customers transferring the money to their mobile accounts first.

The telco had attributed the changes to increased cases of fraud and complaints related to erroneous transfers from bank accounts to other M-Pesa accounts apart from the holders.

ATTEMPT TO STIFLE

Equity, however, denied knowledge of any incidents of fraud cases, arguing that the move was an attempt to stifle its mobile money platform launched in partnership with Safaricom’s rival, Airtel.

“The existence of errors in effecting transfers is not caused by the direct transfer from the bank to M-Pesa as the same errors exist for transfers from one M-Pesa account to another.

The source of such errors is at the input stage where a customer erroneously types the wrong number and an appropriate configuration of the system would stamp out the errors,” Mr Mwangi said.

Safaricom, in an earlier response to the Nation, said the initial agreement with banks had not included the option to send money from a customer’s account to third-party M-Pesa accounts.

The company’s director of corporate affairs, Mr Stephen Chege, said the current agreement Safaricom has with 30 banks and 160 financial institutions had not envisaged the new functionality, prompting the new tariffs.

SOURCE:DAILY NATION