March 5 (Bloomberg) -- Safaricom Ltd., East Africa’s biggest mobile-phone operator, jumped the most in six months on speculation lower rates for money transfer will boost usage.
The stock climbed 5 percent to 3.2 shillings by the close in Nairobi, the capital, posting its largest one-day advance since Sept. 7.
The company cut the charge to send between 101 shillings ($1.22) and 500 shillings over its M-Pesa mobile phone money-transfer service to 25 shillings, from 30 shillings, Nairobi-based Business Daily said March 2. Transfers of 10 shillings to 50 shillings will cost 3 shillings, while previously users were unable to send any amount less than 50 shillings, it said.
“It will make more economic sense, especially for the very poor, to make these types of money transfer transactions,” Eric Musau, research analyst with Standard Investment Bank Ltd. in Nairobi, said by phone. “This could increase the revenue per user and make Safaricom more profitable. M-Pesa is already outperforming the data and voice segments of the company.”
In Kenya, where 45.9 percent of people live in poverty on less than $1.25 per day, the African Development Bank said in a report last month that M-Pesa has brought more than 14 million customers into “virtual” banking.
To contact the reporter on this story: Sarah McGregor in Nairobi at firstname.lastname@example.org
To contact the editor responsible for this story: Andrew J. Barden at email@example.com