Bank to M-Pesa Fees: I&M First to Scrap Charges

I&M Bank has become the first lender in the country to scrap fees on transfers between bank and mobile money accounts. The charges were reintroduced two months ago, after being stopped for two years as part of the country’s response to the Covid-19 pandemic – to encourage cashless transactions.

The move by I&M took effect on Wednesday, February 15th. The waiver, the bank stated, was based on feedback from customers and internal research.

The reintroduction of the fees by all major lenders following a directive from the Central  Bank of Kenya (CBK) in January had fueled widespread discontent among customers of the country’s biggest banks, even as analysts predicted that it would drive an increased preference for cash transactions.

“Adoption of digital payment methods is making life more convenient and allowing people to move faster,” the bank noted.

Highlighting the company’s investments in digital banking products in recent years, I&M general manager for digital business Michael Mwangi stated that the action was also intended to spur increased uptake of its digital products.

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“We look forward to seeing these numbers grow with digital transactions gaining favour among our digitally active customers,” Mwangi stated.

He further cited the economic downturn which has seen food and fuel prices rise in recent months, noting that scrapping the fees would help cushion its customers.

“We believe this move will offer new and existing customers a huge relief during tough economic times and encourage more customers to transact on mobile,” said Mr Mwangi.

“As part of our approach to service delivery, recent customer feedback showed that as much as our transaction rates are favourable, there was an opportunity to review our policies on bank to mobile money wallet charges for the digitally active customer.”

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