Kenya’s leading telco Safaricom has made provisions for the loss of a Sh1.5 billion debt owed by rival telcos Telkom and Airtel which may mean it will write off the debt according to reports.
The debt comes from the two telcos, Airtel and Telkom Kenya using Safaricom’s infrastructure known as co-location, from interconnection fees from cross-network calls and fibre services it rendered to them by Safaricom.
“On expected loss, yes, I think we spoke about this in H1 as well we did see the accumulation of losses from Telkom Kenya, and overall co-location and interconnect all put together is the amount of about 1.5 billion, so that’s the major chunk of the increase in expected loss you may have seen compared to last year,” Safaricom Chief Finance Officer Dilip Pal said.
Airtel and Telkom were in Sh390.7 million and Sh906.6 million debt, Safaricom had disclosed in a letter to the Communications Authority of Kenya (CA) while looking to stop a now-failed merger between the two service providers.
Telkom Kenya says they have a payment plan in place. “Telkom has an agreed-upon payments schedule with Safaricom; one that we are honouring and up to date with,” Telkom CEO Mugo Kibati said.