Leading technology communications company in Europe and Africa, Vodafone plans to sell M-Pesa to Safaricom for $1 as it plans to simplify its management.

After Vodafone announced its first quarter (Q1) results for the year ended in March, the company entered into an agreement in April with Safaricom to sell MPHCL. MPHCL holds M-Pesa customer funds on trust for the benefit of M-Pesa customers in Kenya. Any profit generated by MPHCL, after defraying direct costs, is donated for use for public charitable purposes only.

Notably, Vodafone stated that no material gain or loss is expected to arise on disposal, as completion of the transaction is subject to various approvals, which are expected to be obtained before or during July 2023.

Vodafone wrote,

“Balances included in the Group’s consolidated financial statements for MPHCL on 31 March 2023 include short-term investments of €1,247 million and €1,226 million, due to M-Pesa customers, recorded within other investments and other creditors, respectively.

“These sums are shown in the group’s consolidated financial statements in accordance with IFRS, but MPHCL acts as the independent trustee for M-Pesa customers, independently administering the trust and holding all funds from the M-Pesa customers on trust for the benefit of M-Pesa customers.

It is worth noting that Vodafone has a controlling stake of 65.1% in M-pesa and a 5% indirect equity in Safaricom, and the transfer of the assets to Safaricom came as the company looks set to simplify its management.

An amendment to the trust deed creating M-Pesa Holding, which was published by Safaricom, however, shows that Vodafone was unconstrained in the use of interest income derived from the mobile money cash pool

Investors King understands that the deal will see Safaricom have full control of the platform that started in Kenya. Reports reveal that the move will boost Safaricom’s cash flows in addition to providing interest income if Safaricom invests M-Pesa user deposits in short-term securities.

The Nigerian Communications Commission (NCC) has carried out a sensitization program, over rising cases of Nigerians that are being defrauded through telecoms.

The commission disclosed that it has received complaints from over 20,000 Nigerians who have fallen victim to telecoms scams.

In a bid to sensitize the public, the commission held a consumers sensitization program in Ibadan, Nigeria, at a market, with the theme: “Shine Your Eyes, No Fall Mugu”, addressing the public on the need to stay vigilant and informed to avoid losing their hard-earned money to fraudsters.

While speaking at the sensitization program, the Head of Consumer Affairs of NCC Mr. Ayanbanji Ojo said that many financial frauds are going on through the telecom, hence the need to educate the people, most especially the traders.

In his words,

“The market people are our telecom consumers and without them, we cannot engage in this business. The market people deserve to know what is going on. Today, we are talking about ‘Shine Your Eyes- No Fall Mugu’, which means there are so many financial frauds going on through the telecom and we want to educate our people, particularly the traders.

“So many complaints came from people who lost money to these fraudsters claiming to be telecom operators. So we need to educate our consumers all the time. We are now in the sustainability of the telecom industry and if we don’t sustain the telecom consumers, there is nothing we can do.

“Over 20,000 Nigerians have complained about being defrauded, even as of this morning. There are people we call loan sharks. These people will tell you that someone has obtained a loan from somewhere. How did they get your number and how did they know you are a friend to the person? These are the kinds of things we are trying to prevent and to protect the people, we have to educate them. This initiative is consistent with the mandate of the commission to protect, inform and educate the Nigerian telecom consumers”.

Addressing the complaints about services from telecom companies, Mr. Ojo explained that most of the time, it may appear as though telecom companies are cheating their users, but instead, he stated that these customers are the ones that activate the services which they are billed for.

The sensitization program also had in attendance officials from the Economic and Financial Crimes Commission (EFCC) educating telecom consumers on how to spot fraudsters, and also enlightening them on some of the tricks used by these fraudsters.

Investors King understands that as the Telecom industry evolves, there are growing concerns over the rising trend of fraud perpetuated on Telecom platforms across key sectors of the Nigerian economy. The menace which follows the wide acceptance of new methods of mobile money and electronic banking and payment systems has been discovered to cost the country whopping sums of money.

Fraudsters are now targeting telecom networks with the intent of getting access to consumer information in the databank of service providers. One often used tactic is that these fraudsters conduct SIM swaps of targeted individuals, and then, conduct USSD-based transactions causing huge losses of funds from victims.

Telecommunications giant MTN Nigeria has extended the rollout of 5G networks to 13 cities across Nigeria while noting that it has built 700 base transceiver stations (BTS) to make the network more robust.

The activated cities include Enugu, Owerri, Warri, Ifo, Abeokuta, Port Harcourt, Maiduguri, Ibadan, Kano, Abuja, Lagos, Ife, and Ifo.

Speaking on the extension of the fifth generation (5G) network to several cities across Nigeria, MTN’s Nigeria Chief Technical Officer, Mohammed Rufai stated that Nigerians are currently enjoying the service.

He disclosed that Nigeria was ready for the 5G technology, stating that the capacity has always been there in terms of the availability of spectrum, fiber infrastructure, market, and technical know-how.

“The fact that we are going to 5G does not mean we should not cater to the needs of the subscribers on the other technology. We must also consider those who need the lower technologies. The fact is even that 3G networks can be used for other services in the future. For us in Nigeria, shutting down those technologies is not in the plan now. MTN Nigeria would take into account what subscribers need.

“We shall not leave anyone behind, even as we encourage people to move to higher technology. Of course, we know that a time would come when people on some of those networks will reduce, then we can take appropriate decisions on them”. he added.

It is worth noting that MTN Nigeria became the first telecommunication provider in Nigeria to roll out the 5G mobile network on August 24, 2022. The telecom company is committed to bringing the benefits of 5G services to Nigerians and deploying a network that will drive economic development with increased broadband capabilities nationwide.

Investors King understands that MTN’s extension of 5G services to several states and cities across Nigeria would not only complement the country’s broadband target of 70 percent penetration by 2025, but would also ensure that telecom services expand to remote areas.

The network provider has also continued to provide the 3G, and 4G, networks, especially in rural areas as it seeks to serve more market segments and more different sectors.