Kenyan will now pay for transactions below Ksh. 1000.00 effective January 2021. The central bank of Kenya has stopped free transfer of Ksh 1000.00 and below that was introduced earlier this year to cushion Kenyans from the effects of COVID-19.
Earlier this year, after the first case was reported, the government put on place measures to cushion the economy, among them allowing Kenyans to transfer Ksh.1000.00 and below free of charge.
This measure had been extended to the end of this year, but now according to the Central Bank of Kenya, this will not be extended beyond 31st December 2020.
Now mobile money customers are expected to pay for money transfers for transaction below Ksh.1000.00 in a move that is expected to put allot of pressure on household still feeling the heat of the effects of COVID-19.
There have been massive job loses in the market, coupled with the rising fuel prices in the country.
CBK and financial partners are expected to come up with new transaction fees in the New Year.
In the month of November, Safaricom PLC has hinted at re-introducing the payments after for the first time since its inception, the company had recorded a dip in profits.
Here is the statement from the bank:
CBK has reassessed the emergency measures with the objective of consolidating the gains made so far and also facilitate a transition towards sustainable growth of the mobile money ecosystem. Following consultations with Payment Service Providers (PSPs), CBK will allow the emergency measures to expire on December 31, 2020, and PSPs will introduce revised pricing structures from January 1, 2021, with the following elements:
- There will be no charge for person-to-person transfers of up to Ksh.100 to any customer and network.
- There will be no charges for transfers between mobile money wallets and bank accounts.
- To facilitate the integration of Savings and Credit Societies (SACCOs) with the mobile money ecosystem, SACCOs regulated by the Sacco Societies Regulatory Authority (SASRA) may levy a charge for transfers between SACCO accounts and mobile money wallets. CBK will oversee these charges in the context of the products that banks and PSPs offer to SACCOs.
- Going forward, PSPs will propose pricing structures that reflect the “Pricing Principles” that CBK has introduced. These “Principles” aim to support the development of an efficient, safe, and stable payments and mobile money ecosystem where the customer and public interests are adequately protected. It is noted that the wallet and transaction limits that were announced on March 16, 2020, will remain in force as was communicated earlier. CBK will continue to monitor developments in the payments ecosystem and take any necessary actions.
We await to see what new charges that are coming our way in 2020. We expect that charges below Ksh.100 to remain nil.
