The Central Bank of Kenya (CBK) has announced the official completion of the separation of Airtel Money (AMKL) from Airtel Networks Kenya (ANKL). The mobile money business has been part of the telecommunications business for a while.
It seems the new move by telcos is to separate their mobile money businesses with their network side. Safaricom will also be separating M-Pesa with their network side of things by next year.
Both AMKL and ANKL are incorporated in Kenya as separate subsidiaries of Airtel as separate subsidiaries of Airtel Africa PLC. Artel Africa is headquartered in Dubai, United Arab Emirates, has operations in 14 African countries, and is listed on the London Stock Exchange.
The new entity will be known as Airtel Money Kenya Limited. Welcoming the new changes, the Central Bank has said Airtel’s journey to separate the two entities started in 2019. The completion of this restructuring enables Airtel Money Kenya Limited (AMKL) to ring-fence its operations and focus exclusively on its mobile money business.
Benefits of the separation:
- Better governance of mobile money business
- Strengthen Airtel Money operations
- Offer better services to customers
The Central Bank says on 21st January 2022, it granted Airtel Money Kenya license as a payment service provider (PSP) in line with the National Payment System Act 2011. The company was also granted a transition period to complete the transfer.
CBK says it has engaged PSPs to ensure that the activities under CBK’s supervision are appropriately ring-fenced from other business lines. This, the regulator says, will allow the PSPs to protect their CBK-regulated activities from shocks emanating from the other business activities, strengthen governance, enhance resilience, and focus on improving its services to customers.
This effort will facilitate realization of the vision in the National Payments Strategy 2022 – 2025, of “a secure, fast, efficient and collaborative payments system that supports financial inclusion and innovations that benefit Kenyans.”