Safaricom remains silent on the fate of Mali, its initial money market fund, while promoting Ziidi, its new offering. Legal disputes arise regarding customer transitions from Mali to Ziidi, along with technical issues affecting Mali’s operations. Despite challenges, Ziidi has amassed over KES 6 billion in funds since its launch.
Safaricom, Kenya’s largest telecommunications company, has not provided details about the fate of its initial money market fund named Mali, launched in 2020, as it pursues the aggressive rollout of its replacement, Ziidi. Ziidi received regulatory endorsement in November 2024 and is developed in collaboration with Standard Investment Bank, ALA Capital Limited, and Sanlam Investments East Africa Limited. Controversy surrounds the introduction of Ziidi, particularly concerning the unclear status of Mali as Safaricom seeks to onboard users onto the new fund.
On M-PESA’s 18th anniversary, Safaricom announced that over one million users had already registered with Ziidi, which has accrued KES 6 billion (about $46 million) in capital. Reports indicate that some customers may have been transitioned from Mali, sparking legal disputes with Mali’s fund manager, Genghis Capital.
In December 2024, Genghis Capital accused Safaricom of migrating customers to Ziidi without their consent and claimed that the company engineered a liquidity crisis leading to mass withdrawals from Mali amidst ownership disputes. The situation further deteriorated in late December 2024 and early January 2025 due to persistent technical issues preventing customers from accessing funds or registering.
Despite these issues, Ziidi remains operational while Mali is temporarily frozen for new sign-ups, leading to speculation that it may be phased out. Both funds continue to be listed on Safaricom’s M-PESA app, yet neither Safaricom nor Genghis Capital has responded to inquiries.
As of September 2024, Mali ranked as Kenya’s 17th-largest collective investment scheme, managing KES 3.1 billion (approximately $24 million) in assets and generating KES 11.6 million (about $89,000) in revenue for Safaricom in the first half of the year. The Kenyan investment fund sector experienced a significant increase, with total assets under management rising 13% to KES 254 billion ($1.9 billion) by June, up from KES 225 billion ($1.7 billion) in March, according to Capital Markets Authority (CMA) data.
The launch of Safaricom’s Ziidi has sparked controversy regarding the discontinuation of its predecessor, Mali. Legal disputes, customer migration without consent, and technical failures have clouded the transition. Despite these issues, Ziidi has seen significant uptake, while Mali’s future remains uncertain amid operational disruptions. Overall, the Kenyan investment funds market continues to expand, emphasizing the popularity of money market funds in particular.
Original Source: techcabal.com
