Safaricom not required to allow BitPesa M-Pesa access – court

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The Kenyan High Court judge hearing the legal complaint made by BitPesa and Lipisha against Safaricom has ruled not to require Safaricom to reinstate BitPesa’s access to the M-Pesa network while the case is ongoing.

Disrupt Africa reported in November Kenyan bitcoin remittance startup BitPesa and automated mobile payments company Lipisha launched a legal complaint against the country’s leading mobile operator Safaricom, over allegations Safaricom intimidated Lipisha, and forced Lipisha to temporarily stop providing services to BitPesa.

BitPesa allows individuals to transit money in bitcoin that the company then converts into physical currency.

The Lipisha automated mobile payments platform allows businesses to collect, automate and integrate payments from customers and clients using mobile money.  

The Lipisha service was used by BitPesa until November 12, when Lipisha says Safaricom “intimidated” it into stopping services to BitPesa, in a bid to block BitPesa’s access to the M-Pesa mobile money network.

Lipisha and BitPesa asked the High Court to require Safaricom to allow BitPesa to continue using the M-Pesa network, through Lipisha, until the court makes a ruling in the main complaint brought against Safaricom.

The court decided the case can continue, but chose not to oblige Safaricom to allow BitPesa’s access for the duration of the trial.

“We are pleased with the High Court’s ruling, which permits BitPesa to continue to fight Safaricom’s wrongful and unlawful bullying,” BitPesa said.

“The Court has not dismissed BitPesa’s case, but rather has ruled only that BitPesa is strong enough as a company that it does not require access to M-Pesa to survive during the course of the case.”

The startup says Safaricom’s alleged efforts to put obstacles in the path of BitPesa’s activities prove the startup has become a strong contender in the marketplace.

According to BitPesa, the case exemplifies the debate around how corporates and startups engage with each other; whether through partnering, corporates cloning startups’ ideas, or even trying to squash them.

“As a startup grows up, it begins to get noticed by established companies. This is a great milestone in any startup’s life. Should the established companies partner with the startup? Should they copy it? Should they close their eyes and wait to see if the startup withers? Or, should they try and squash it?” BitPesa chief executive officer (CEO) Elizabeth Rossiello said.

“[This case] is about BitPesa standing strong against an incumbent, with its internal operations and compliance policies laid bare before the court, proud in its graduation from startup to scalable contender in the marketplace. That Safaricom has moved against us shows that we have already won.”

In addition, BitPesa took the opportunity to announce it has integrated with Airtel Money in Kenya, which it says “continues to power customer transactions 24/7 alongside our other bank payment channels.”

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Inspired and excited by the African tech entrepreneurial scene, Gabriella spends her time travelling around the continent to report on the most innovative tech startups, the most active investors, and the latest trends emerging in the ecosystem.

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