Ziidi money market fund of Safaricom under scrutiny for alleged competitive misconduct
The Competition Authority of Kenya (CAK) is currently investigating Safaricom over allegations of preferential treatment for its new money market product, Ziidi. The investigation follows a formal complaint filed by Cytonn CEO Edwin Dande, represented by I.C. Law LLP.
The complaint alleges that Safaricom is distorting the market by giving Ziidi free access to its M-PESA infrastructure while rival funds are forced to pass on transaction costs to customers. This preferential treatment is claimed to create restrictive trade practices and violate Sections 21 and 24 of Kenya's Competition Act, which prohibit unfair market access limitations and abuse of dominant position.
As of June 2024, money market funds held 67.4% of total collective investments, amounting to KES 171.2 billion ($1.3 billion). However, investors using other funds are charged between KES 10 and KES 60 for deposits and withdrawals, while Ziidi users pay nothing. The complainants argue that this setup limits market access for competing funds and distorts competition in the retail investment market.
The complainants name Standard Investment Bank, ALA Capital, and Sanlam Investments East Africa as indirect beneficiaries of this pricing setup, giving Ziidi an unfair customer acquisition and retention edge. They have formally requested CAK to investigate and take enforcement action, including terminating the exclusive arrangement and imposing sanctions to restore a level playing field.
The rapid growth in Kenya's money market space has been accompanied by increased competition, particularly around access to low-cost, mobile-first retail investors. The call for CAK's intervention comes amid growing disquiet over the rollout of Ziidi.
The complaint further claims that the setup amounts to a restrictive vertical agreement between Safaricom and Ziidi, where similar transactions are treated differently. Some Mali users were allegedly migrated to Ziidi without opting in, which sparked a legal dispute between Safaricom and Genghis.
Neither the law firm representing Dande nor Safaricom immediately offered comment on the matter. Ziidi received regulatory approval in November 2024 and now counts over one million users with KES 6 billion ($46 million) in assets. The structure is said to limit market access for competing funds and potentially erode trust in the country's digital finance ecosystem.
The complainant wants to ensure a level playing field in the market, preventing one product from gaining an unfair advantage through exclusive access to infrastructure. The ongoing investigation by CAK is expected to shed light on these allegations and potentially reshape the competitive landscape of Kenya's money market sector.
[1] Nairobi News, "CAK investigates Safaricom over Ziidi," June 2025, https://www.nairobinow.com/business/cak-investigates-safaricom-over-ziidi/ [2] Business Daily Africa, "Safaricom faces competition probe over Ziidi," June 2025, https://www.businessdailyafrica.com/news/companies/Safaricom-faces-competition-probe-over-Ziidi/10666986-5021024 [3] Capital FM, "CAK probes Safaricom over Ziidi," June 2025, https://www.capitalfm.co.ke/business/2025/06/cak-probes-safaricom-over-ziidi/ [4] The Star, "Safaricom under probe over Ziidi," June 2025, https://www.the-star.co.ke/business/2025/06/21/safaricom-under-probe-over-ziidi_c1662579
- The allegations against Safaricom suggest that the company is using its dominant position in the mobile technology industry to provide preferential treatment to its new investment product, Ziidi, through exclusive access to its M-PESA infrastructure.
- This preferential treatment is claimed to violate the Competition Act's prohibition of unfair market access limitations and abuse of dominant position, as it creates restrictive trade practices and limits market access for competing funds in the retail investment market.
- The complainants argue that the ongoing investigation by the Competition Authority of Kenya (CAK) could potentially reshape the competitive landscape of Kenya's money market sector, ensuring a level playing field and preventing one product from gaining an unfair advantage.
