Kenya Power locks out vendors of electricity tokens

Payments for new connections have also been restricted to mobile money. [File, Standard]

Electricity consumers will no longer buy Kenya Power prepaid tokens from third-party agents.

Starting Thursday, customers will buy tokens exclusively from the company.

Kenya Power had contracted nine companies and two banks to sell the power units to customers on prepaid meters, which accounted for about 10 per cent of the company's power sales.

The firms' contracts are, however, set to expire today (August 31) and Kenya Power has decided not to renew them.

In a notice yesterday, the firm said effective September 1, customers will only buy tokens from Kenya Power and pay through mobile money, specifically M-Pesa, as well as its banking halls. It further warned that payments to the agents might mean a loss of funds for the customers.

"Please note that no other third-party agent is authorised to offer these services on behalf of KPLC. The company will therefore not take liability for any transaction conducted through any other platform," said the company in the statement.

KCB Bank, which had been acting as one of the vendors, notified its customers that they would no longer be able to buy prepaid tokens from its mobile banking and Vooma platforms. The lender added that it was working on resolving the matter with Kenya Power.

Postpaid electricity customers will have the option of paying through a pay bill number or 15 banks, with plans to increase the number of banks that can collect funds for Kenya Power from this category of customers.

Payments for new connections have also been restricted to mobile money.

While restricting payments to M-Pesa might appear to disadvantage some of its customers, telco firms recently implemented pay bill interoperability, whereby a user of one platform is able to pay a merchant who has another platform's pay bill.

There are expectations, however, that Kenya Power will bring other mobile money operators on board.

The move by Kenya Power is expected to play a part in reducing the firm's commercial losses.

It is, however, a big blow for the agents that sell power tokens, with some having their businesses largely centred on the venture and the commissions that they make from the sales accounting for a substantial proportion of their revenues.