Safaricom may have lost hundreds of millions of shillings in a billing hitch for its internet business over the last two years. Business Today has learnt that the leading mobile operator under-billed its SME clients for enterprise services in 2015 and 2016 by up to 16 percent.
It is not clear how much was lost, but sources say it translates to hundreds of millions of shillings. The glitch was discovered only late last year, forcing the company to rectify the situation by raising charges. The company wrote to all its data clients early January, explaining the situation.
“We have recently undertaken a review of our products and we would like to bring to your attention a discrepancy in your invoice which has resulted in your account being under-billed for the past few months,” said Ms Agnes Gathaiya, the head of enterprise sales SMEs and regional operations. “We have corrected the error and your January 2017 invoice should reflect the same.”
The company then provided a schedule for the correct pricing of the compact series range of products as specified in the application forms that clients had signed. While the letter talks of few months, a number of clients who talked to BT said they had been under-billed since March 2015.
Given that it was its own mistake and the possibility that demanding the accumulated amounts from the clients would cause a backlash and massive unsubscribing, Safaricom has decided to absorb the loss. “Please note,” Ms Gathaiya says in the letter, “that we will not be back-billing your account for the undercharge and the above rate will only apply going forward.”
Many clients have not taken the move kindly, with those who had got used to the lower rates protesting for being overcharged for the month of January and February.
Some said Safaricom had taken advantage of the hitch to increase its service rates. “I have been paying Ksh4600 for the last two years and it’s shocking to see the rates going up,” said a business consultant based in Nairobi’s CBD who was affected by the move. “I noticed the drop in bills but I imagined the company had revised the charges downwards, just like they do for calls.”
Others allege that Safaricom dropped the rates as a marketing gimmick to attract more clients through referrals and raised when it had thousands of them signed up. It is not clear how the billing hitch went on for two years without being detected in a technology company like Safaricom.
The company has been fighting for market share for internet services among SMEs, which had been dominated by Jamii Telecom, Orange, Zuku and Liquid Telecom. With fibre-backed speeds, Safaricom has been able to make foray in this market, mostly snapping up dissatisfied clients from other companies.
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