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Safaricom Blames Slow Internet Speeds on Undersea Cable Outage

Tuvuti Editorial Team
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Safaricom Blames Slow Internet Speeds on Undersea Cable Outage

Safaricom attributes the slow environment to a cut on two of its critical undersea cables, which are central to delivering its traffic in and out of Kenya. The mobile service provider assured customers that redundancy measures have since been activated to minimize service interruptions until full restoration of the cables is done in a statement.

The outage has affected services, including the M-Pesa Super App and Safaricom App. Safaricom has called for customers to either use the USSD code *334# for M-Pesa services or the SIM tool kit as alternatives.

Airtel Kenya issued a similar statement, urging customers to use the USSD code *334# for accessing Airtel Money services. Other internet service providers like Zuku communicated the issue with their customers via text message.

Starlink Unveils Cheaper Data Plan: 50GB for Sh1,300, Jolts Safaricom, Airtel

Tuvuti Editorial Team
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Starlink Unveils Cheaper Data Plan: 50GB for Sh1,300, Jolts Safaricom, Airtel

Starlink, the satellite internet provider founded by Elon Musk, is planning to shake up the competition for established Safaricom and Airtel in Kenya with its new, cheaper data plan. The new 50GB monthly data package from Starlink is offered at Sh1,300, significantly undercutting a similar Airtel pack that is currently on sale at Sh3,000.

The price at which Safaricom sells its 45GB monthly package is Sh2,500. Still, subscribers have to make a one-off investment of Sh45,500 in installation hardware, unlike in the case of local telcos where users only activate a registered SIM card to get online.

According to its website, Starlink will charge entry prices of Sh1,300 a month for 50GB of data, then Sh20 per GB for extra volume. It accepts payments through mobile money providers M-Pesa and Airtel Money.

This aggressive pricing is as it guns to capture the data segment long dominated by Safaricom and Airtel. According to Communications Authority of Kenya, Safaricom currently commands 63.7 percent market share of mobile broadband subscriptions, followed by Airtel with 31.5 per cent. Other providers are Telkom Kenya with 1.8 percent; Finserve, Equitel with 1.5 percent and Jamii Telecommunications also with 1.5 percent.

Starlink launched satellite internet last July at prices rival to other fixed internet service providers.

Reopening of Schools Hits Telcos’ Text Messages Revenue

Tuvuti Editorial Team
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Reopening of Schools Hits Telcos’ Text Messages Revenue

The reopening of schools after the December long holiday break had a toll on the revenue generated by telcos from text messages in relation to the first quarter of 2024. According to the latest statistics from the Communications Authority of Kenya, mobile short message service usage dropped by 4.3 percent.

The numbers also point to a drop in both on-net and off-net mobile SMS. On-net dropped 4.7 percent to 11.8 billion messages, while off-net decreased by 5.3 percent to 1.6 billion messages. This drop has been blamed on the end of the long school holiday and the close of the festive season.

The number of text messages sent per month per subscription also went down to an average of 65.8 messages during the quarter from 70.4 messages in the previous quarter. The decrease in the usage of SMS is thus linked, due to new consumption habits, to a users’ change towards more and more voice calls.

Voice traffic also jumped to 25.2 billion minutes in Q1 2024 from 23.6 billion minutes in Q4 2023, услed by a host of promotions and offers that made their way back to spur usage of voice calls. Term two dates had to be changed in view of the prolonged rainfall that caused flooding across the country.

Kenyans Abandon 600,000 Feature Phones in Three Months for Smartphones

Tuvuti Editorial Team
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Kenyans Abandon 600,000 Feature Phones in Three Months for Smartphones

In what has been termed as a significant technological shift, Kenyans dropped 628,818 feature phones in the three months to March, adopting smartphones instead. The shift underpins the growing need for gadgets with advanced functionalities, especially internet connectivity.

The latest statistics from the Communications Authority of Kenya indicate that the total feature phones in use dropped from 31.8 million in December to 31.2 million at the end of March, a two per cent drop. On the other hand, smartphone usage increased from 33.6 million to 34.5 million with a 2.6 per cent rise.

The total mobile devices connected to the networks reached 65.7 million, with a penetration rate of 127.5 percent. The feature phones, which have very simple applications like calling and texting, are being phased out by the smartphones answering more modern needs, like access to the Internet.

International bandwidth usage expanded by 1.5 percent to 11,155.2 gigabytes per second during this period, partly due to the introduction of Starlink’s high-speed satellite internet from space in Kenya.

The trend started last September with the penetration of smartphones pushing out feature phones. Smartphone users increased to 32.63 million then, against 32.04 million users of feature phones.

Aggressive marketing by phone makers and mobile network operators, who give credit options, further fuels the increased adoption that makes it easier for low-income consumers to own a smartphone. In October last year, President William Ruto opened Kenya’s first mobile phone assembly plant with the objective of pushing the cost of a smartphone down to $40, about 5,178 KES. A study, however, revealed that locally assembled smartphones still retailed at up to 11 500 KES due to high taxes.

Active mobile subscriptions increased by 1.9 percent to 68.0 million as of March, leading to a SIM penetration rate of 132.1 percent. This has been on the back of customer win-back campaigns executed within the period.

Over 80,000 New Investors Join CBK’s Digital Platform for Government Securities

Tuvuti Editorial Team
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Over 80,000 New Investors Join CBK’s Digital Platform for Government Securities

Since July 2023, when the CBK launched its digital trading platform for government debt securities—DhowCSD—it has more than doubled in terms of investor sign-ups to surpass 80,000 new accounts. This certainly manifests one clear indicator of success with regard to attracting retail investors onto the platform for easier and more convenient investment in securities.

DhowCSD is one version of the Central Securities Depository infrastructure that went live on 31 July 2023. The upgrade will make investing in government securities much easier and user-friendly. CBK Governor Kamau Thugge says the number of accounts rose to between 80,000 and 90,000 in less than a year from the 40,000 existing at the time of the launch, indeed rising by 100 percent. Thugge indicated the role of the platform in simplifying the earlier intimidating process of physically visiting CBK offices to open accounts.

It provides a digital platform through which one can open and run CSD accounts via their smartphones and the internet, eliminating the necessity of visiting the CBK offices physically. That has made it easy for retail investors to sell and buy government securities from the comfort of their homes or offices. The CBK is now looking to extend this ease to Kenyans in the diaspora. It eyes increasing remittances by encouraging these Kenyans to invest in government securities.

CBK has engaged with Kenyans in the diaspora, accompanied by investor tours in the US and the UK in popularizing DhowCSD. Governor Thugge underscored its potential to facilitate remittances from Kenyan diaspora plus indicated that it had received warm reception upon presentations in the US. It has plans to increase such outreach to other regions like West Coast of US, China, and Japan.

After the launch of the platform, participation of retail investors in domestic debt auctions has gone through the roof. CBK data shows that as of June 19, retail investors held 12.92 per cent of the government’s domestic debt, equivalent to Sh671 billion. This move went on to cement the efficiency of the platform in democratizing access to Government securities.

The next phase for DhowCSD will be the integration with a revamped M-Akiba, which is a retail infrastructure bond-like product aimed at enhancing financial inclusion as a driver of economic development. After problems faced in the first edition, including liquidity challenges and low market understanding, M-Akiba is now set to be moved from the National Treasury to the CBK. The new platform is due to start running in the second half of 2024, solving these problems with the view of allowing ease of entry and exit into the market by investors with a minimum of Sh600 to invest.

Among the many successes chalked up by DhowCSD, CBK has been awarded the prize of Central Banking’s Payments and Market Infrastructure Initiative Award this March. The award recognizes the platform as having provided broadened access to government debt securities for all Kenyans, which is hereby scored in support of CBK’s commitment toward financial innovation and inclusion.

With CBK set to further improve on DhowCSD while adding the instrumental M-Akiba to its platform, the outlook remains bright for retail investors who eye efficient and accessible ways to invest in government securities.

Committee Recommends Suspension of SHIF Rollout Due to Digital Platform Issues

Tuvuti Editorial Team
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Committee Recommends Suspension of SHIF Rollout Due to Digital Platform Issues

The Ministry of Health’s transition committee has advised deferring the implementation of the new SHIF, which is expected to become operational on July 1, citing technical glitches on the digital platform designed for contributions and registrations.

The committee overseeing the Social Health Authority, the entity set up to administer SHIF and eventually replace the National Health Insurance Fund, NHIF, said a dry run on an Information Communication Technology, ICT, system they are to use revealed a high level of unpreparedness. This recommendation comes less than a week to the expected rollout date.

In light of these findings, the Health Ministry has been entreated to retain the current NHIF structure and withdraw already published regulations by SHIF. The committee emphasized that alternative solutions, with a possible recall of SHA regulations, shall be utilized under the current infrastructure provided by NHIF. This move, however, has financial implications, especially on the licenses for NHIF systems and their renewal contracts.

A pilot test in Marsabit revealed a number of readiness issues with the new system. It was felt that a further pilot, including proxy mean testing, would be required by the committee. ICT experts have been tasked to explore alternative solutions for SHA’s registration and contribution system.

The committee was chaired by Dr. Jason Kap-Kirwok and had the mandate to design this fund following its inauguration on January 30, 2024, by Health Cabinet Secretary Susan Nakhumicha. Early in March, Nakhumicha announced that beginning July 1, SHIF would start running, with all contributions mandatory for all above the age of 18, funding Universal Health Coverage.

Under the proposed SHIF contributions, Kenyan workers will in future pay 2.75% against their gross income, significantly improving the deductions from higher earners at a time when the economy is struggling with rising inflation. For example, those earning Sh50,000 would see their deductions go up to Sh1,375, Sh100,000 at Sh2,750, and Sh500,000 at Sh13,750 gross pay if uncapped. Low-income earners, on the other hand, will find some reprieve, with a worker earning Sh20,000 now seeing deductions drop to Sh550 from Sh750 under NHIF. Those without any source of income will also be obliged to pay a minimum of Sh300 per month to SHIF, towards facilitating UHC.

The recommendations made by the SHA Transition Committee have enveloped the feasibility of the launch of SHIF in big question marks, considering that NHIF, which is expected to form the backbone of SHIF, has myriad problems, including owing private hospitals large amounts in unsettled claims. Members of the Rural Private Hospitals Association of Kenya (Rupha) are reportedly over 400 members who have stopped accepting NHIF cards following unsettled claims amounting to over Sh6 billion, greatly affecting their operations.

The cost for the entire ICT system central to the management of payments to healthcare providers by the SHA is at least Sh 5 billion; a few Members of Parliament haveAssignable Asked for SHIF enrolment suspension with immediate effect, citing discontent over how procurement for the whole process is being handled. According to the Health Committee in Parliament, there are suspicious data security risks and probable corruption relating to procurement.

Section 47 of the SHIF limits the application of secure and trusted technology in digitization and processes, applying the Data Protection Act 2019 and other relevant laws. That notwithstanding, non-transparency and non-readiness of the ICT system remain one big challenge. There has also been concerns in the education sector after the government scrapped cover for the secondary school students in public institutions dubbed EduAfya under the NHIF without a proper alternative.

Testing by the Ministry to identify vulnerable households needing financial assistance has yet to begin. Some high earners who had a ceiling of Sh1,700 under NHIF will also go up under SHIF. Non-salaried people who used to pay Sh500 per month under NHIF will now pay Sh300 under SHIF.

Mobile Money Subscriptions Rebound After Scrapping of Airtel Transfer Code

Tuvuti Editorial Team
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Mobile Money Subscriptions Rebound After Scrapping of Airtel Transfer Code

The mobile money landscape in Kenya has seen a massive rebound in subscriber numbers after Airtel removed the restrictive transfer code. This innovation had been instrumental in re-developing the sector, which was fast losing the number of users over the past year.

According to a new sector statistics report released by the Communications Authority of Kenya, 700,000 more subscribers were accounted for in mobile money during the first quarter of this year, thus pushing the total number of subscribers to 38.7 million users as of the end of March, from 38 million at the close of December.

The recent surge is quite a turn-around from the previous trend of decreasing numbers. Subscribers of mobile money stood at about 38.4 million in March last year, dropping to 38 million in June, and rising slightly to 38.1 million by September.

CA says in the report that growth of subscriptions in mobile money squares to a penetration rate of 75 per cent. Growth was recorded, though the percentage penetration rate dropped slightly following a revised denominator population on release of the 2024 Economic Survey.

The main factor behind the increase in mobile money subscription is the scrapping of a withdrawal code by Airtel. This code had required Airtel Money customers to withdraw cash within seven days of receipt or have the amounts reverted to the senders. With the scrapping of the restriction, there is now an easier flow of the user experience.

With the change that came into effect on 6th February 2024, customers can now be in a position to receive funds directly into their respective wallets from any network, not excluding M-Pesa. The move sets the scene for the implementation of the Central Bank of Kenya’s National Payments Strategy 2022-2025, aimed at improving mobile money interconnectivity across the different networks.

Not only has the scrapping of this restrictive code increased the number of Airtel Money users, but also, according to a CA report, it has spurthed the growth in the use of mobile money countrywide. During the reference period, mobile money subscriptions grew underlining positive reception from users.

In its 2024 Economic Survey, the Kenya National Bureau of Statistics reports that 600 000 mobile money subscribers were lost in the past year. This change changes the trend set up, which indicates the essence for regulatory and industry collaboration towards the growth of the sector.

The enhanced interoperability now allows users on rival platforms to send between Sh1 and Sh250,000 per transaction daily to Airtel Money accounts. This flexibility has likely helped in increasing the adoption of mobile money services. The government shelved plans to increase taxes on mobile money transfers as a way of raising funds to fund the budget that was expected to take care of a number of things including employment of JSS teachers on permanent and pensionable terms.

A Detailed Guide on How to Sell a Business Quickly

Tuvuti Editorial Team
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A Detailed Guide on How to Sell a Business Quickly

No one wants to be in a position where they have to sell their business quickly, but sometimes it happens. Maybe your spouse gets sick, and you need a large sum of money, or you’re too old to run the business anymore, or you just want out immediately. What do you do? You don’t just close up shop and forget about everything. You worked too hard building up this business to just let it go to waste. What you do is you plan on selling it as fast as possible so you can get on with the next chapter of your life.

Know how much your business is worth

You won’t be able to quickly sell your business if you don’t know what it’s worth. Typically, business owners overvalue how much their business is worth, and if you don’t do a proper assessment, you’ll end up asking way more than it’s worth. The sale of your business is important, and if you jack up the price way too high, no one is going to buy it fast.

Set a price that you know is going to get some attention

For this example, let’s say that you own a small flower shop, and you think your business is worth $150,000. You might make your starting offer right at what it’s worth or go just a hair under. You have to keep in mind that even though you are pricing the business at a lower price, people are still going to try to get you to go lower. If you settle for $100,000, don’t put that at your price, or people will try to get you down to $50,000.

The only time you start at a super low price is if you’re looking to sell immediately. So, in the case we mentioned above, you might put a $100,000 price tag on your business and say that you won’t negotiate any on the price. If you’re firm when trying to sell your business, it might work but still expect people to try to bring you down even more.

Go to your competition and ask if they’d like to buy you out

Sometimes when you sell a small business, you have to do things that you’d otherwise never do. Not every small business looks at their competition as their enemies and you might have a good rapport with your competition. If you do, just come right out and ask if they’d like to buy your business.

Going to your competition first when trying to sell your business is a good idea if you know they want to expand. You may need to bury the hatchet and find a way to come together, but usually, if the competition knows your serious and the price is right, they might be willing to consider buying your business.

Those of you who live in a major city that has several competitors are in a better situation than people who live in a small town because you’ll be able to pitch your business to more people. Selling your business to a competitor isn’t as strange as it sounds, and more than likely, they are the ones who know the value of your business more than anyone else.

Advertise the sale of your business like there’s no tomorrow

Plaster signs all over the inside and outside of your business. Buy full-page ads in your local newspaper, and try to get on every local broadcast that you can. Make sure that everyone who can see or hear knows that your business is for sale.

Hype the sale of your business to anyone and everyone who is willing to listen. If you want to make some fast cash, there’s only one way to get the word out there. Some of you may think that this is being overly pushy, but the truth is, you’ll need to get the word out there. If no one knows that your business is for sale, no one will buy it.

Ask neighboring businesses if you can put a sign on their property telling people that your business is for sale. Hopefully, your business will sell fast enough that you can take down the signs right away. No one will want you to put a sign on their property for years, but for a few weeks, they should be okay with it.

Use a business broker if all else fails

A business broker will be able to put your business on the market and sell it fast. You’ll have to pay them a fee, and it might be high, but they’ll help you sell your business as quickly as possible. The right broker will know all the right people with deep enough pockets to make the sale go through in the time frame you need it to.

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