Safaricom takes rivals to court over non-payment of termination fees

9 May 2012

Kenyan mobile giant Safaricom has initiated legal proceedings against rivals Airtel Kenya and Essar Telecom Kenya (yu), in a bid to recover more than KES500 million (USD5.9 million) worth of unpaid termination fees accrued since October. According to Business Daily Africa, market leader Safaricom has demanded close to half a billion shillings from Airtel, and around KES173 million from Essar. It has also indicated that it is seeking interest and collection fees for delayed payment, arguing that the dues are hurting its cash flow. The suggested interest has been pegged on the average base rate, which currently stands at 20.34%, and Safaricom hopes that the penalty will act as a deterrent for delayed payments.