Safaricom cools M-Pesa spin-off

Safaricom cools M-Pesa spin-off

Safaricom chief executive officer Michael Joseph calmed mounting interest in the operator spinning off its successful mobile money division M-Pesa into a seperate company.

Joseph said: "At this time there is no change in our position," stating the telecoms giant has yet to see huge benefits to the business with such a shift.

In March Joseph said Safaricom was in the “early stages of thinking” of spinning off the successful M-Pesa business. Prior to that, the chief executive noted making M-Pesa independent with its own board would expand the range of services on the platform, such as high-value loans.

In the financial year ending March, M-Pesa recorded KES50 billion (US$421m) in profit before tax contributing almost half of the operator’s total gross earnings, making it Safaricom’s most profitable service, reported The Star.

In a separation of Safaricom’s financial unit, M-Pesa will come under the jurisdiction of the Central Bank of Kenya, while the company will continue to be monitored by the Communications Authority.

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