Airtel delinks mobile money arm from communications unit
The second-largest telecommunications company in Kenya Airtel has led the charge in splintering its telecommunications business from the mobile money arm amid growing disquiet over regulation.
The Central Bank of Kenya (CBK) has termed the creation of Airtel Money Kenya Ltd (AMKL) a turning point that will afford the mobile money entity the liberty to streamline operations and provide customers with higher grade services.
“The completion of this restructuring enables AMKL to ring-fence its operations and focus exclusively on its mobile money business. Significantly, this sets the foundation for AMKL to enhance governance over its mobile money business, strengthen its operations, and offer better services to its customers,” said CBK in a statement.
CBK added that AMKL’s licensure as a Payment Service Provider (PSP) was completed in late January this year and also granted a transition period pursuant to the National Payment System Act, 2011.
Read also: Safaricom’s M-PESA Pay Bill Numbers to accept Airtel Money, T-Kash payments
Airtel’s disjunction into constituent telecoms and mobile money units has materialized amid intensifying calls for telcos to distinguish the two lines of service lines to allow for seamless regulation by Communications Authority and the CBK, respectively.
Dagoretti South MP John Kiarie doubled down on this conception when he quizzed the CBK Governor on the roles of the legislature and the banking industry regulator in differentiating the respective value chains during a special sitting in late September.
“From where you sit as central bank, how can this parliament help you with legislation and would it mean that we break these telecommunication companies into different operating units?” Mr Kiarie posed.
Following the trend set by Airtel, analysts will be keenly watching to see if Kenya’s biggest telco, Safaricom, will eventually capitulate and treat M-PESA as an independent venture from telecommunications.
