A fund supervisor has requested the Competitors Authority of Kenya (CAK) to research Safaricom over what he says is preferential remedy for its new cash market product, Ziidi. The Could 26 letter by I.C. Regulation LLP, which mentions Cytonn CEO Edwin Dande as its shopper, claims that Safaricom is distorting the market by giving Ziidi free entry to its M-PESA infrastructure whereas rival funds are compelled to move on transaction prices to clients.
“We submit that this association constitutes a restrictive commerce follow below part 21 of the Competitors Act because it applies dissimilar situations to equal transactions, limits market entry for competing funds, and distorts competitors within the retail funding market,” the letter, which TechCabal noticed, stated.
“We respectfully request that the Competitors Authority of Kenya examine this conduct and take acceptable enforcement motion, together with the termination of the unique association and imposition of essential sanctions.”
The letter argues that the construction breaks competitors legislation, and rests the case on the declare that Safaricom, which controls over 91% of cellular cash companies in Kenya, is utilizing its infrastructure to provide Ziidi privileged entry on the expense of everybody else.
The letter additional claims that the setup quantities to a restrictive vertical settlement, the place Safaricom and Ziidi, two separate entities, deal with related transactions in a different way. Traders utilizing different funds are charged between KES 10 and KES 60 for deposits and withdrawals, relying on the quantity. Ziidi customers pay nothing.
The letter names Normal Funding Financial institution, ALA Capital, and Sanlam Investments East Africa—Ziidi’s fund managers—as oblique beneficiaries of this pricing setup. The complainants declare this provides Ziidi an unfair buyer acquisition and retention edge, even when competing funds supply related or higher returns.
The decision for CAK’s intervention comes amid rising disquiet over the rollout of Ziidi. Safaricom has not addressed the way forward for Mali, its first cash market product launched in 2020, which has remained frozen since early 2025. Genghis Capital, Mali’s fund supervisor, beforehand accused Safaricom of orchestrating a silent exit from Mali, first by triggering a liquidity crunch after which directing clients towards Ziidi with out consent.
Ziidi obtained regulatory approval in November 2024 and now counts over a million customers with KES 6 billion ($46 million) in property. Some Mali customers had been allegedly migrated to Ziidi with out opting in, which sparked a authorized dispute between Safaricom and Genghis. Whereas each merchandise nonetheless seem on the M-PESA app, solely Ziidi stays operational. Mali is now not accepting new sign-ups.
Kenya’s cash market house has seen speedy progress. As of June 2024, cash market funds held 67.4% of complete collective investments, amounting to KES 171.2 billion ($1.3 billion). This progress has include elevated competitors, significantly round entry to low-cost, mobile-first retail buyers.
The complainant desires CAK to compel Safaricom to both lengthen zero-rated M-PESA entry to all market gamers or restore parity by charging transaction charges on Ziidi. They argue that with out such enforcement, the market will tilt additional in favour of vertically aligned merchandise and erode belief within the nation’s digital finance ecosystem.
Neither the legislation agency representing Dande nor Safaricom instantly provided touch upon the matter.
