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Safaricom customers given free M-Pesa deal

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Entities as diverse as utility firms, hospitals and banks have hooked up their systems to M-Pesa. file photo | nmg

Telecoms operator Safaricom #ticker:SCOM on Tuesday said it had resolved a technical problem that caused Monday’s network outage, leaving millions of customers stranded.

Safaricom chief executive Bob Collymore said their response team moved to fix the equipment failure that saw the network go down on Monday morning, rendering subscribers unable to make calls, send messages or transact over the M-Pesa platform.

“We had two traffic outlets which failed rapidly one after the other. In response, as a priority, the team very quickly started operating the affected functions from our redundant equipment in order to restore services,” said Mr Collymore.

The cause of the debilitating incident was yet to be made public yet.

Although the telecom firm said it had repaired its network by the Monday afternoon, services remained sporadic throughout Monday night and Tuesday morning and only returned to normalcy in the afternoon.

Mr Collymore, whose time at the helm of Safaricom is expected to come to an end this year, gave M-Pesa users 24 hours of free person-to-person mobile money transfers as a balm for the inconvenience and losses suffered over the two days.

Safaricom’s share at the Nairobi Securities Exchange (NSE) lost ground marginally, closing at Sh18.95 Tuesday from Sh19.10 the previous day, meaning that the firm shed Sh6 billion of market capitalisation.

READ: Safaricom may face sanctions over network outage

The Communications Authority of Kenya (CA) said it would hold back on imposing any sanctions on Safaricom until a detailed report on the incident is submitted.

“The authority is awaiting a comprehensive report on the incident from Safaricom in order to determine whether there was any omission on their part in line with the obligations of their licence,” the CA said.

Safaricom has 71.6 per cent market share of Kenya’s mobile subscription and is the largest player in the country’s mobile money business that moves an average of Sh9 billion per day via its M-Pesa platform.

The outage brought back fears raised by the Treasury last year that M-Pesa may have such a dominant role in the economy as to pose a fiscal risk to Kenya.

Entities as diverse as utility firms, hospitals and banks have hooked up their systems to M-Pesa.

Kenya Power #ticker:KPLC, for instance, relies on mobile money for 46 per cent of all its billing but said the firm was not able to quantify the impact of the outage, even as it said the effect was “significant”.