The Cooperative Bank of Kenya (CBK) has removed charges on airtime purchases through the bank’s mobile app Mcoop Cash in an effort to provide relief to thousands of customers who were previously charged bank fees and excise duty on airtime purchases. This move comes after widespread public backlash, particularly in light of a struggling economy caused by the COVID-19 pandemic.
The new policy means that all airtime purchases below Sh100 will now be free to from transaction charges, offering a reprieve to customers who were paying more than half the value of the airtime in additional charges. Airtime purchases between Sh101-150 will still incure a Sh5 charge, while purchases above Sh501 will incure a Sh40 charge. This representing a significant reduction in charges for customers who were previously paying Sh10 in bank fees and Sh2 in excise duty for a Sh10 airtime purchase.
Removal of transaction fees when buying airtime through the Mcoop Cash app, comes shortly after the government increased excise duty on the same to 20 percent from initial 15 percent. From that decision alone, the government is expected to earn Sh8 billion from mobile operators.