Airtel Kenya’s Struggle To Raise Funds Sees It Sell A Quarter Of Its Mobile Money Stake For KES 64B


Airtel Kenya has sold 25.77 percent of its mobile money product Airtel Money in a deal that seeks to raise more cash for the company’s operations.

First reported by the Business Daily, the sale saw four companies give Airtel Kenya $550 million after the transaction. They are Rise Fund, which invested $200 million, followed by Mastercard at $100 million. Qatar Holding LLC invested $200 million, while Chimera Investment LLC parted with $50 million to round up the stake’s purchase.

It should be noted that this is not the first time that Airtel Kenya’s parent owner for the continent, Airtel Africa, has ceded ownership of its mobile money stake because it has done the same thing in other markets, including Tanzania, Rwanda, and Zambia.

Airtel Money, while being second to M-PESA in terms of market share, struggles locally as it attempts to make a mark for itself. M-PESA, for instance, has since owned 99% of the local mobile money market share in the majority of pointers, including customer and agent numbers, as well as revenues.

M-PESA has also gone further in expanding its product portfolio by launching a virtual card for international online purchases in collaboration with VISA.

This has made M-PESA a dominant product, and while the state and relevant authorities have not declared it so, regulators have since attempted to make the market fairer to the competition. For instance, mobile money customers, including those of Airtel Money and Telkom Kenya’s T-Kash can use Safaricom Buy Goods Till numbers interchangeably, although they cannot access paybill numbers, yet.

It would also make sense why such developments are being made. The value of Airtel Money in Kenya is at more than KES 250 billion, meaning M-PESA is substantially higher than that. And that is by considering that Airtel Money performs poorly locally, although it has done admirably in other African markets.

Airtel Kenya as a whole is also struggling to raise cash for its operations. In 2020, for instance, Airtel wrote a letter to the Communications Authority of Kenya, and lobbied it to revise spectrum fees downwards. The plea’s main point was that a review of spectrum fees would enable carriers to deploy cheaper services to customers.

Airtel has also since said that it will clear a KES 2.2 billion bill for its current license it has been using since 2015. Airtel Kenya’s operating license expired back in 2015.

The firm only had two options to settle its issue with the CA: sell 30 percent of its stake to locals, or pay the KES 2.2 billion. Airtel, as of this February, has picked the latter option.