NAIROBI, Kenya – Kenya’s mobile users may be paying far more for voice calls than they should — not because operators lack the capacity to lower prices, but because long-awaited regulatory reforms keep stalling.
A new World Bank report now warns that these delays are tilting the market in favour of the biggest telcos, limiting competition and locking consumers into unnecessarily high calling costs.
High Call Rates Linked to Delayed Reforms
The World Bank’s latest Kenya Economic Update paints a clear picture: mobile termination rates (MTRs) — the fees operators pay each other to connect calls — remain “far above cost,” shielding dominant players like Safaricom while squeezing smaller rivals.
Although the Communications Authority of Kenya (CA) cut the MTR from Sh0.58 to Sh0.41 per minute in March 2024, the regulator has not yet shifted to a fully cost-based model.
This is despite a previous plan to reduce the fee to Sh0.12 per minute by January 2022, a move Safaricom opposed, citing its massive voice market share.
With the current rates set to expire on February 28, 2026, the World Bank says Kenya has a critical window to finally implement cost-oriented reforms.
“These create club effects that favour larger operators,” the report states, noting that smaller networks end up paying more because a higher share of their calls terminate on bigger networks.
Outdated Market Structure Keeping Costs High
Beyond MTRs, the World Bank points to deeper structural issues slowing competition and inflating prices.
Infrastructure sharing, for instance, still relies heavily on informal negotiations. The rules, unchanged since 2010, allow operators to share towers and fibre — but with no strong oversight, larger firms can quietly delay or deny access.
Smaller providers are then forced to build duplicate towers, draining resources that could go toward expanding affordable coverage.
The report also highlights spectrum allocation as an area overdue for reform. While Kenya still uses administrative licences, many countries now rely on competitive auctions to ensure spectrum goes to operators who can deploy it most productively.
International examples from Nigeria, Colombia and Myanmar show that independent tower companies dramatically lower costs and enhance service quality — a model Kenya has yet to fully embrace.
Consumers Hit Hardest as Cheaper Calling Remains Elusive
With MTRs still high, Kenya lags behind regional peers. Tanzania charges Sh0.089 per minute, dropping to Sh0.081 by 2027, while Uganda slashed its rate from Sh1.64 to Sh0.95 last year.
This matters most for low-income users.
According to the World Bank, half of Kenya’s bottom 40pc still rely on basic phones, making voice calls four times more common than internet use in this group.
Yet Kenyans continue paying premium calling fees:
- Safaricom: up to Sh4.87 per minute
- Airtel: up to Sh4.3 per minute
- Actual cost of MTR? Just Sh0.06, according to a 2022 CA study
Market data for June 2025 shows Safaricom controlling 63.4pc of the voice market and generating 18.49 billion minutes out of the industry’s 29.16 billion. Only 7.9pc of its calls go to other networks, meaning it pays very little in termination fees — but smaller rivals don’t enjoy the same advantage:
- Telkom: nearly a 50–50 split between on-net and off-net calls
- Airtel: 3.1 billion outgoing off-net minutes vs. 7.4 billion on-net minutes
This imbalance translates into higher operational costs for smaller players — costs that eventually land on consumers’ bills.
What the World Bank Wants Kenya to Fix
To unlock cheaper calls and healthier competition, the Bank recommends:
- Stronger, enforceable infrastructure-sharing rules
- Transparent, auction-based spectrum allocation
- Fully cost-based MTRs
- Faster dispute resolution for operators
The report warns that slow reforms have already cost the country. Safaricom’s interconnect revenue has fallen by more than Sh2 billion since rates began dropping from the highs of Sh2.21 per minute in 2010 — but the current system still leaves Kenya behind its neighbours.
“The delay in drastic MTR cuts has left Kenya behind other countries in the region, slowing affordability and market efficiency,” the report concludes.
