In Kenya’s increasingly digitized economy, access to fair and open financial infrastructure isn’t just a matter of principle but a lifeline for small businesses and startups. That’s why the recent controversy surrounding Safaricom’s Ziidi Money Market Fund has stirred significant concern in the entrepreneurial ecosystem, including among our community here at OfficePhase.

On May 26, a legal complaint submitted by I.C. Law LLP to the Competition Authority of Kenya (CAK) alleged that Safaricom is engaging in anti-competitive practices by giving Ziidi preferential access to its powerful M-PESA infrastructure. The fund, launched in November 2024, now boasts over one million users and KES 6 billion ($46 million) in assets under management.

At the heart of the issue is this: while Ziidi users can transact at no cost, investors using competing funds, such as those offered by Standard Investment Bank, ALA Capital, or Cytonn, pay between KES 10 and KES 60 for similar deposit and withdrawal transactions. This pricing disparity gives Ziidi an unfair advantage in customer acquisition and retention, even when other products may offer better returns.

Why This Matters for Businesses at OfficePhase

At OfficePhase, we work closely with a vibrant mix of startups, consultants, and creative professionals. Many of them use mobile money platforms as their primary gateway to savings, investment, and capital management tools. A level playing field in the fintech space is critical for innovation and for trust.

When a dominant market player like Safaricom, which controls over 91% of Kenya’s mobile money transactions, allegedly extends zero-rated access only to its own investment product, it risks distorting the market. For small business owners already grappling with tight margins, losing out on lower-cost investment options can have a ripple effect, reducing cash flow, limiting financial planning options, and discouraging participation in digital finance altogether.

Moreover, the allegations that users of Mali, Safaricom’s earlier fund, were migrated to Ziidi without consent further erode trust in Kenya’s digital financial ecosystem. These developments, if unchecked, could undermine the progress made in building inclusive financial tools that empower the underserved.

A Call for Fairness and Transparency

The request for CAK’s intervention is not just a legal or regulatory concern; it is fundamentally about economic fairness. As CAK deliberates on its response, businesses throughout Kenya, including those located at OfficePhase, are paying close attention. Many are advocating for one of the following actions:

• Equal access to M-PESA’s infrastructure at zero cost for all money market funds; or
• Restoration of parity by reintroducing standard transaction fees for Ziidi, to eliminate preferential treatment.

Both paths would strongly indicate that Kenya’s digital economy prioritizes fair competition, ensuring that no player, regardless of size, is above fostering a healthy market environment for all.

Looking Ahead

Kenya’s money market funds currently represent 67.4% of collective investment schemes, totaling KES 171.2 billion ($1.3 billion) as of June 2024. With such significant capital flows at stake, ensuring equal access to distribution platforms like M-PESA is essential not only for investors, but for every entrepreneur leveraging digital finance to scale their vision.

At OfficePhase, we are committed to supporting businesses with the space, tools, and insights they need to thrive. We also recognize that a successful business environment requires more than great infrastructure; it requires fairness.