Communications Authority of Kenya Director-General Francis Wangusi.
A dispute is simmering between two government agencies on regulation of Pesalink, a new mobile money transfer service launched last month.
Communications Authority of Kenya (CA) tuesd said it was kept in the dark on the launch of Pesalink, which it claims falls under its regulatory oversight in what could stir up a turf war with the Central Bank of Kenya (CBK).
“Anything that is going to be carried by the telecommunications systems and services requires the involvement of the authority and this (Pesalink) is something that we have not been consulted by the Central Bank about,” said Director-General Francis Wangusi at a press briefing in Nairobi Tuesday.
He said services like Pesalink fall under a grey regulatory area and require involvement of more than one regulator.
“We are groping in the dark at the moment because they don’t know how we do it and so we are unable to collaborate for efficient delivery of this service,” he said.
Pesalink is seen by industry analysts as a possible rival to M-Pesa’s long-standing dominance in mobile money transfer.
The new service allows consumers to transfer money directly to and from one bank account to another without going through an intermediary.
It has a maximum cap of Sh999,999 that users can transfer at a go. This allows those constrained by mobile money transfer limits another option outside the existing check and RTGS funds transfers.
Kenya Bankers Association (KBA), which is championing the service, has said more than 12 banks had signed up to Pesalink, with 15 others expected to come on board by the end of this month pending shareholders’ approval.
“We are not providing a product to compete with existing market players,” explained KBA chief executive Habil Olaka in a past interview.
“This product is accessing a segment that has not existed before. Currently, customers are only transacting up to Sh70,000 and we intend to bridge this gap.”
However, Mr Wangusi said the telecommunication sector regulator had reached out to CBK with a view to signing a Memorandum of Understanding on the regulation of Pesalink.
“We are waiting to sign an MoU with Central Bank so that we can determine how to handle such services that overlap the jurisdictions of several regulators,” he said.
He further revealed that leading mobile service provider Safaricom would not be split according to recommendations by UK-based research firm Analysys Mason.
Mr Wangusi said the report would be taken as the professional opinion of the consultants, pending more consultations.
“At this point in time and even in the future as our telecommunications markets are still growing, we are not contemplating splitting any company for any purposes,” he said.
“Our role is to make sure we provide the modest regulatory environment encouraging market growth and to avoid small players being overrun by market leaders.”