Safaricom’s licence costs rose to $127 million after securing a 25-year permit in Kenya

Safaricom, East Africa’s largest telecom operator, led by Kenyan tycoon Peter Ndegwa, has paid $127 million (Ksh16.38 billion) to secure a 25-year operating license in Kenya, reinforcing its long-term foothold in East Africa’s largest telecom market.

The licence, granted by the Communications Authority of Kenya, replaces a temporary two-year extension and aligns Safaricom’s operating rights with its spectrum licences. The renewal enhances regulatory certainty and supports long-term investments in 5G rollout, broadband infrastructure and mobile financial services.

Licence renewal strengthens long-term growth

The 25-year authorisation is among the longest telecom operating licences issued in Africa, significantly extending beyond the traditional 10-year cycle. 

The longer tenure reduces renewal uncertainty and gives Safaricom greater visibility for capital allocation, particularly in network expansion, enterprise solutions, and digital services. With improved regulatory stability, the operator is positioned to accelerate investments in 5G infrastructure, broadband rollout, and mobile financial services.

Strong earnings supported by Kenya and Ethiopia expansion

In its first 2026 reporting cycle, Safaricom posted a profit attributable to shareholders of Ksh95.61 billion ($740.3 million) for the year ended March 2026, representing a 37% year-on-year increase. Growth was driven by robust performance in Kenya and accelerating operations in Ethiopia, where service revenue surged 58.3% to Ksh14.08 billion. 

Mobile data remained the group’s core revenue driver, rising 14.4% to Ksh83.35 billion, supported by increased 4G and 5G adoption. Fixed broadband and enterprise connectivity also expanded, reflecting rising demand for fibre-based services. The M-Pesa platform continued to anchor Safaricom’s fintech franchise, reinforcing its leadership in mobile payments across East Africa.

Cost performance showed mixed trends. Other operating expenses declined to Ksh98.86 billion ($764.4 million) from Ksh104.31 billion ($806.7 million), reflecting improved operational efficiency. However, direct costs rose to Ksh104.42 billion ($807.6 million) from Ksh101.08 billion ($781.6 million), driven by higher network and service delivery expenses.

Safaricom shifts to long-term telecom licences

Safaricom’s 25-year licence strengthens its leadership in Kenya’s telecom market and supports long-term growth across mobile, broadband and fintech segments.

Across Africa, telecom operators are increasingly securing long-duration licences to justify heavy infrastructure investments. Countries including South Africa, Nigeria and Egypt have adopted similar frameworks, enabling operators to invest in 5G networks, broadband expansion and digital infrastructure.

The renewal is expected to drive continued investment in 5G, cloud services and regional expansion, positioning the company to benefit from rising demand for data and digital financial services across Africa.