Grace Ashiru
Kenya is witnessing a heated dispute as Genghis Capital, an investment bank, accuses Safaricom of “business fraud” over the launch of Ziidi, the telco’s newly introduced money market fund. Ziidi, which made its debut in November 2024, has ignited a significant fallout between the two firms.
Here’s how it started: In 2020, Genghis partnered with Safaricom to launch Mali, a money market fund seamlessly integrated into M-Pesa. However, Genghis now alleges that Safaricom intentionally delayed Mali’s rollout, only to secretly register and launch Ziidi in collaboration with other third parties. According to Genghis, this move violated their prior agreement and undermined the trust established since their partnership began in 2019.
In a letter dated December 3 and obtained by TechCabal, Genghis accused Safaricom of unethical practices, claiming the telco prioritized developing Ziidi while leaving Mali in limbo. Safaricom responded on December 6, defending its actions by stating that Mali faced “technical issues” that made scaling the product risky, potentially exposing both companies to regulatory and reputational challenges.
The allegations don’t stop there. Genghis also claims Safaricom violated privacy laws by transferring customers from Mali to Ziidi through the M-Pesa app without obtaining their consent. If proven, this could place Safaricom in serious trouble for breaching data protection regulations.
Despite these accusations, Mali has not been a failure. By September 2024, it stood as Kenya’s 17th-largest collective investment scheme, managing assets worth $23.9 million (KES 3.1 billion). Additionally, it generated $89,748 (KES 11.6 million) in revenue for Safaricom in the first half of the year alone.
This clash underscores the fierce competition within Kenya’s wealth management and digital finance sectors. Safaricom is evidently focused on expanding its investment services through M-Pesa, but these accusations and the subsequent breakdown in trust could reshape how partnerships in the industry are structured and managed in the future.
