Safaricom backs down on unpopular change to tariff

Corporate News

Sylvia Mulinge, General Manager for Consumer Business, Safaricom. PHOTO | FREDRICK ONYANGO  NATION MEDIA GROUP

By KIARIE NJOROGE, gkiarie@ke.nationmedia.com

In Summary

• Subscribers can keep their accumulated bundles but any new ones purchased from May 1 will expire in 30 days.
• The reversal follows an outcry from the tariff’s more than 150,000 subscribers, with some threatening legal action.
• The Karibu tariff, one of the cheapest available, is closed to any new subscribers and will not be opened.

Safaricom has changed its mind about taking away all the unused airtime, SMS credits and data held by Karibu Postpay tariff users after May 26 this year.

The telecoms operator now says subscribers can keep their accumulated bundles but adds that any new ones purchased from May 1 will expire in 30 days.

“All current (Karibu PostPay) subscribers will be able to continue enjoying their accumulated minutes and data until they are fully exhausted,” Sylvia Mulinge, the general manager for consumer business, said.

The reversal follows a public outcry from the tariff’s more than 150,000 subscribers, with some threatening legal action or a switch to rival mobile service providers. Most had expected to keep their accumulated bundles when the firm announced long-awaited changes to the Karibu tariff.

On Thursday, Safaricom announced that the monthly charge and bundles received would remain unchanged but added that they would expire after 30 days. They also gave subscribers up to May 26 to clear accumulated units or lose them.

Users with large amounts of accumulated units, however, complained that they had paid for them and Safaricom’s move was a violation of their rights.

The Karibu tariff which was introduced in 2011 has two price plans.

For Sh1,000 per month, a subscriber gets 900 minutes talk time for calls within the Safaricom network, 100 minutes for off-net calls (to non-Safaricom lines), 100 megabytes (MB) of data and 100 on-net SMSes.

For Sh2,500, they get 2,200 minutes for Safaricom-to-Safaricom calls, 300 minutes to rival networks, 250MB of data and 250 on-net text messages.

Any unused minutes, data and SMSes were rolled over to the next month when a fresh bundle was issued. Early adopters, therefore, accumulated tens of thousands of minutes, SMS units and data bundles, whose growing value — estimated at hundreds of millions of shillings — is a headache to Safaricom.

The changes to the loss-making tariff were aimed at ridding Safaricom’s balance sheet of this liability. The firm has been feeling the weight of rewards schemes such as Bonga Points, which are only recognised as income upon redemption by customers.

The Karibu tariff, one of the cheapest available, is closed to any new subscribers. Safaricom says there are no plans to allow more users to join.