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Banks pushing CBK to return mobile money transfer charges

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Banks are pushing the Central Bank of Kenya (CBK) to reinstate mobile cash transfer charges whenever customers move money from their bank accounts to mobile money wallets, after making losses due to fall in fees and commissions from such transactions.

KCB chief executive Joshua Oigara said that the bank is persuading the regulator to ensure that charges are reinstated before the end of the year, whether full or discounted .

“Customers are getting more transactions digitized. We are working with CBK to get fees and commissions on these transactions. This is a good opportunity to look at the charges. I don’t see the charges going back to the levels they were before the pandemic. We see a discounted level of charges on the mobile transactions.” Oigara said.

Reinstating the charges will be good news to lenders which are are missing out in a market that is increasingly embracing digital transactions. They raised complaints with regulator arguing that they are losing millions per month due to the free transfers between them and M-Pesa, T-Cash and Airtel Money among others.

Banks used to charge transaction fees between Sh30 to Sh197 before the waivers were introduced after the Covid-19 broke out when the government urged citizens to embrace cashless transactions.

But Oigara pointed out that KCB mobile banking transactions have gone up by 70% in the six-month period to June, which is good enough to compensate for discounted rates.

CBK had only announced resumption of charges of bank to mobile wallets that are linked to the Sacco sector in A pril, a move that motivated banks such as Co-operative Bank to roll out discounted rates. It also saw the value of KCB mobile transactions increase by 104% when it hit Sh1.12 trillion at the end of June from, which is down from Sh550 billion which was the case in the previous year.

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