Kenyans are set to enjoy lower calling rates, according to a statement by the Communications Authority of Kenya (CA).
In the statement to newsrooms on Friday, November 17, the industry regulator announced that it had reviewed Mobile Termination Rates (MTRS) and Fixed Termination Rates (FTRs).
MTRS and FTRs refer to the costs that operators charge each other to allow customers to communicate across networks.
The review, as per the statement, capped MTRs and FTRs at Ksh 0.41 per minute- down from the current Ksh 0.58 rate per minute.
However, SMS rates in the country remained unchanged at 0.05 per SMS.
The new rates will only apply to calls originating and terminating in Kenya, meaning that rates for international calls will be higher.
Wins for Kenyans and industry – CA
As per the Communications Authority, the review was informed by the prevailing economic environment and dynamics in the ICT market.
In addition, CA stated that the need to strike a balance between the promotion of investment and the protection of consumers also influenced the change.
Further, the regulator explained that the current rates will be in use for a period of two years beginning March 2024.
In the statement, CA asserted that the new rates would present a win-win situation for both Kenyans and operators.
Also Read: Ezra Chiloba Resigns as Communications Authority Director General
On one hand, CA noted, Kenyans will have access to a variety of affordable services while operators will also have more price flexibility in developing more affordable products.
“Lower MTRs and FTRS mean lower calling rates for consumers. This decision will have positive outcomes for both the consumers and operators,” the statement read in part.
Consequently, all network operators were directed to change their interconnection agreements in line with the new rates.
Operators clash over reduced calls rates
But the rates have faced possible initial setbacks with mobile operators in the country disagreeing on the reduction of call rates.
Appearing before the National Assembly Committee on Communication Information, Safaricom Chief Executive Officer (CEO) Peter Ndegwa said the reductions would have far-reaching effects on the economy.
Also Read: Safaricom Call Revenue Drops in Half Year Results
According to Ndegwa, Mobile Termination Rates have for years undergone a downward review which poses a challenge to government revenue collection and puts pressure on the cost of doing business.
As such, the Safaricom Chief urged the state to halt the reductions to give CA more time to come up with favorable rates.
“We urge that the aggressive reductions are halted to provide the much-needed time for economic stability to be achieved,” Ndegwa told the Committee on Thursday, November 16.
On his part, Mugo Kibati- the CEO of Telkom Kenya, told MPs that the company would support the downward review of MTRs, as it will make the market more competitive and all operators more sustainable.
