No doubt, and credit to the management and marketers of Safaricom, it has grown immensely since those early days, including innovating M-Pesa, which contributes to its dominant status in the telecom industry and runs the risk of determining and fixing tariffs and prices.
Just like in the political arena, too much power and dominance by a few companies is dangerous and can cause more problems than we think.
Many years ago, a thoughtful and reflective friend of mine told me how, after completing his dream house in one of the leafy suburbs of Nairobi, he found himself making improvements every year. One year, it would be putting in a hot tub, the next was installing wall-to-wall carpeting, then it was improving the kitchen.
Then after a day of hustling with the contractor, his wife asked him why they never seemed to be satisfied with what they had and always wanted more. Now, my friend is a good Christian man and a church elder, so the couple prayed on this issue before sleeping. The next day, they decided that God surely would be frowning for wanting more and more despite His abundant blessings in them. He told me that at that point a sense of relief, grace and peace swept through them.
I remember this story as I have been reflecting on the lay-offs and down-sizing in the private sector over the last year.
We are told that our economy is growing at between 5-6 per cent, which is translating into job losses rather than job creation, especially in the banking sector.
The banks are quick to blame declining profits on the recent interest rate cap that was intended to make loans more affordable and accessible. But the banks say there has not been a significant increase in people taking loans, so their profits are falling. Note that the banks are not making losses, only reducing their once massive profits, making the downsizing and lay-offs almost seem like “whitemail” to return us to the status quo of unfettered interest rates.
But, like my friend who got his epiphany from prayer, the banks – and many of us actually – need their own moments of reflection.
For the last decade or so, the banking sector has been swimming in it, with 2015 profits reported at Sh134 billion. Year after year, banks have been reporting increasing profits – sometimes dubiously as we learned from Chase Bank and Imperial Bank – but the main beneficiaries have been the shareholders and executives whose salaries and bonuses have shot up, while workers’ pay remained constant.
These boom times brought massive wealth and bonuses to shareholders and executives, gobbling up most of the profits, while ordinary staff and customers have been left holding the bag, so to speak. Yet when there is a downward shift, it is the customers who face increased transaction costs and ordinary staff who are laid off who take the hit.