A prominent fund manager has urged Kenya’s Competition Authority (CAK) to investigate Safaricom, alleging that its newly launched money market product, Ziidi, benefits from unfair preferential treatment.
In a letter dated May 26, penned by I.C. Law LLP on behalf of Cytonn Investments CEO Edwin Dande, the complainant accuses Safaricom of leveraging its dominant M-PESA infrastructure to give Ziidi an edge over rival funds, distorting competition in Kenya’s retail investment sector.
Allegations of Restrictive Practices
The letter asserts that Safaricom’s arrangement with Ziidi constitutes a restrictive trade practice under Section 21 of Kenya’s Competition Act.
It highlights that Ziidi enjoys free access to M-PESA’s mobile money platform, which controls over 91% of Kenya’s mobile money market, while competing funds incur transaction fees passed on to their customers.
This, the complainant argues, creates unequal conditions for similar transactions, restricts market access for other players, and undermines fair competition.
“By providing Ziidi with cost-free access to its infrastructure, Safaricom is tilting the playing field, giving an unfair advantage to its affiliated product,” the letter states.
The complainant has called for CAK to probe this conduct, terminate the exclusive arrangement, and impose appropriate penalties.
READ ALSO:Safaricom’s Ziidi Money Market Fund Receives CMA Approval
Vertical Agreement Concerns
The letter further contends that the relationship between Safaricom and Ziidi amounts to a restrictive vertical agreement.
While Ziidi users face no fees for deposits or withdrawals, investors in rival funds are charged between KES 10 and KES 60 per transaction, depending on the amount.
This pricing disparity, the complainant claims, unfairly benefits Ziidi’s fund managers, Standard Investment Bank, ALA Capital, and Sanlam Investments East Africa,by enhancing customer acquisition and retention, even when competitors offer comparable or superior returns.
Growing Tensions in the Money Market Space
The controversy surrounding Ziidi coincides with unease over Safaricom’s handling of its earlier money market product, Mali, launched in 2020.
Mali has been dormant since early 2025, with its fund manager, Genghis Capital, accusing Safaricom of engineering a liquidity crisis and quietly shifting users to Ziidi without their consent.
Some Mali customers reportedly found themselves enrolled in Ziidi without opting in, triggering a legal dispute between Safaricom and Genghis.
While both products remain visible on the M-PESA app, only Ziidi is currently operational, boasting over one million users and KES 6 billion ($46 million) in assets since its regulatory approval in November 2024.
Kenya’s money market sector has experienced significant growth, with funds accounting for 67.4% of collective investments, totalling KES 171.2 billion ($1.3 billion) as of June 2024.
This expansion has intensified competition, particularly for mobile-first, low-cost retail investors, making access to platforms like M-PESA critical.
READ ALSO:Safaricom and Genghis Capital Clash Over M-Pesa Investment Trusts
Call for Market Parity
The complainant has urged CAK to level the playing field by either granting all money market funds zero-rated access to M-PESA or imposing transaction fees on Ziidi users.
Without intervention, they warn, vertically integrated products like Ziidi could dominate the market, eroding confidence in Kenya’s digital finance ecosystem.
As of now, neither Safaricom nor I.C. Law LLP has issued a public response to the allegations.
The outcome of CAK’s potential investigation could reshape the competitive landscape of Kenya’s booming money market industry.
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