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Safaricom Hikes Cost of Money Transfers Following Tax Changes

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Kenya's Safaricom has raised the cost of sending money through its mobile money service, M PESA following changes in government taxes.

The company said that the government has introduced a 10% excise duty tax on transaction fees for all money transfer services provided by cellular phone providers, banks, money transfer agencies and other financial service providers.

As a result of the change, the handling fee for transactions worth more than Kshs 101 (US$1.20) will go up by 10% with charges for transactions under Kshs.100 remaining unchanged.

Safaricom CEO, Bob Collymore said, "As Kenya's largest taxpayer, we appreciate the need to support government as it seeks to reach its financial obligations. However, we maintain our position that a tax on mobile money is at that this time premature and is likely to have a negative impact on the country's financial deepening agenda by creating an unnecessary barrier for wananchi who are most in need of basic financial services."

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Tags: safaricom  m-pesa  Kenya