By Starting today, the fee that Safaricom pays Airtel every time one of its customers calls an Airtel number dropped from Ksh 0.41 per minute to Ksh 0.37. That is a reduction of four cents per minute, a number so small it sounds meaningless. But the mechanism behind it, and where it is heading over the next four years, has significant implications for what you pay for calls, how competitive Kenya's telecom market becomes, and why Safaricom has fought this process at every turn.
The Communications Authority of Kenya published its determination on February 26, setting a four-year glide path for mobile termination rates. Today's cut is the first step. By 2029, the rate will reach Ksh 0.30, a 27% reduction from where it was yesterday. Whether that translates into cheaper calls on your bill depends on how aggressively operators compete. History says it should. But history also says the regulator keeps stopping well short of what its own data says rates should actually be.
What a Termination Rate Actually Is
Before the analysis, a clear explanation, because this is one of those regulatory concepts that affects every Kenyan with a phone but that almost nobody fully understands.
When you call someone on a different network, two networks are involved. Your network originates the call. The receiving network (the one your contact uses ) terminates it. The receiving network charges your network a fee for that termination service. That fee is the Mobile Termination Rate, or MTR.
The receiving network charges this fee because it has to carry your call on its infrastructure for the final leg of the journey. Fair enough, that costs something. The question is how much it actually costs, and whether the fee charged reflects that cost or reflects market power.
The CA's own commissioned study in 2022 found that the true, efficient cost of terminating a call in Kenya is Ksh 0.06 per minute. As of yesterday, the mandated rate was Ksh 0.41. As of today it is Ksh 0.37. By 2029 it will be Ksh 0.30.
Even at the end of this four-year glide path, Kenya's termination rate will be five times higher than what the CA's own consultants said it should be. Tanzania has committed to rates of approximately Ksh 0.08 by 2027. The World Bank, in a November 2025 assessment, called Kenya's telecom regulations structurally outdated and explicitly said they favour incumbent firms.
The incumbent firm in question is Safaricom.
Why Safaricom Fights Every Rate Cut
To understand why termination rates matter so much to Safaricom specifically, you need to understand the asymmetry of Kenya's voice traffic.
Safaricom controls 61% of Kenya's voice traffic, 18.3 billion of 29.9 billion total minutes in the most recent CA data. Crucially, only 7.8% of Safaricom's calls are off-network, meaning they end on Airtel or Telkom. In contrast, nearly 30% of Airtel's traffic is off-network, terminating on Safaricom.
What this means in practice: Safaricom receives far more termination fees than it pays. When an Airtel customer calls a Safaricom number (which happens constantly given Safaricom's dominance) Airtel pays Safaricom a termination fee. The reverse happens far less often. Safaricom's network size makes it a net receiver of interconnection revenue at scale.
In the year ending March 2025, Airtel and Telkom Kenya paid Safaricom Ksh 4.7 billion in interconnection fees. That is not revenue for a service Safaricom is stretching to provide, that is revenue that flows directly from Safaricom's market dominance. Every reduction in the termination rate reduces that figure.
This explains why Safaricom has fought every rate cut with unusual intensity. In 2022, when the CA proposed cutting rates to Ksh 0.12 per minute, Safaricom filed a case with the Communications and Multimedia Appeals Tribunal. The matter was eventually settled out of court at Ksh 0.58, higher than the CA's proposed cut. In 2024 the rate was reduced to Ksh 0.41. Today it drops to Ksh 0.37, on its way to Ksh 0.30 by 2029. Each step of the way, Safaricom has resisted, and each time the final rate has settled above what the regulator initially proposed and far above what the CA's own cost analysis says it should be.
What the 2010 Price War Tells Us
The last time Kenya saw a significant termination rate cut was in 2010. The result was dramatic, a price war among operators that sent retail call prices tumbling and made Kenya one of the more affordable mobile markets in East Africa for a period.
The CA is explicitly hoping history repeats itself. The mechanism is straightforward: lower termination rates reduce the cost burden on smaller operators, who currently spend heavily on fees paid to Safaricom every time their customers call a Safaricom number. With lower costs, Airtel in particular has more room to price aggressively and compete for customers who have stayed with Safaricom partly because on-net calls within Safaricom are cheaper.
For consumers, the realistic best-case outcome of this glide path is that cross-network calls become genuinely comparable in price to on-net calls, bundle offerings from Airtel and Telkom become more competitive, and Safaricom is pressured to improve value rather than relying on network lock-in.
For SMEs and businesses that operate across networks (which is essentially every business in Kenya that has customers on multiple telcos ) lower interconnection costs reduce operational overhead directly. A logistics company coordinating drivers across Safaricom and Airtel lines spends less on cross-network calls. A customer service team handling calls from multiple networks sees its airtime costs fall.
The Gap That Should Bother Everyone
The four-year glide path ending at Ksh 0.30 is a reasonable regulatory move. But the number that sits quietly in the background of every CA determination on this subject deserves more attention than it gets.
Kenya's own commissioned cost study says the efficient rate is Ksh 0.06. The regulator's own consultants produced that number. The World Bank endorsed it. Tanzania is heading toward Ksh 0.08. Some European markets have moved to zero-rated termination entirely, treating interconnection as a cost of doing business rather than a revenue line.
Kenya is going to Ksh 0.30 by 2029, five times the cost-efficient rate, with a fresh review scheduled at that point. Senator Samson Cherargei of Nandi raised this specific inconsistency in the Senate in November 2025, asking the CA to explain the gap between its own consultant's recommendation and the rates it actually sets. The CA has not given a satisfying public answer.
The most credible explanation is that the regulator is balancing consumer welfare against Safaricom's investment commitments. Safaricom has used the language of network investment in every argument against aggressive rate cuts, lower termination revenue means less money to invest in infrastructure, which means slower network expansion, which ultimately hurts consumers. It is an argument that carries some weight in a country where Safaricom's infrastructure genuinely serves areas no other operator reaches. It is also an argument that conveniently defends a revenue stream worth Ksh 4.7 billion per year.
What to Expect on Your Bill
The direct impact on your monthly spend depends on how you use your phone and which network you are on.
If you make most of your calls within Safaricom ( the situation for most Safaricom subscribers) the termination rate change does not directly affect you yet. On-net calls do not cross networks and do not involve termination fees.
If you regularly call across networks (Safaricom to Airtel, Airtel to Safaricom, any combination involving Telkom) the rate reduction should eventually feed through to cheaper cross-network bundles and lower pay-as-you-go rates. The timeline depends on how aggressively Airtel chooses to pass savings on and whether Safaricom responds competitively.
The most significant impact will be felt if a genuine price war follows, as happened in 2010. If Airtel uses the cost reduction to launch genuinely competitive cross-network voice bundles, Safaricom will face a choice between matching those prices or losing subscribers. That competitive dynamic, not the rate cut itself, is what produces the consumer benefit that the CA is engineering toward.
The Bigger Picture
Today's rate reduction is the right direction. A four-year glide path ending at Ksh 0.30 is better than no reduction, and the CA's decision to mandate the change rather than leaving it to operator negotiation removes Safaricom's ability to simply refuse to lower rates bilaterally.
But it is worth being clear-eyed about what this is not. It is not a bold regulatory intervention that brings Kenya in line with international best practice. It is not a rate that reflects the actual cost of termination. It is a measured, politically calibrated compromise that moves the needle while leaving Safaricom's interconnection revenue business substantially intact through 2029.
For that to change, the CA's 2029 review would need to take the Ksh 0.06 cost-efficient rate seriously rather than treating it as an aspirational benchmark perpetually deferred into the next review cycle. Given the history, that review will again involve lobbying, legal pressure, and the same argument about investment incentives.
The mwananchi's best hope in the near term is that Airtel takes advantage of the breathing room this glide path creates and competes hard enough to force Safaricom's hand on pricing. That is how the 2010 story went. Whether 2026 follows the same script depends less on regulation and more on whether Kenya's second-largest telco has the appetite for a real fight.
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