Equitel overtakes Telkom Kenya to become Kenya’s 3rd-largest telco, fueled by mobile banking integration and rising user growth.
Equitel Surpasses Telkom to Become Kenya’s Third Largest Telco
By Charles Wachira
Equitel, the mobile virtual network operator (MVNO) owned by Equity Group Holdings, has overtaken Telkom Kenya to claim the position of Kenya’s third-largest telecom operator by market share. This marks a pivotal moment in the country’s fast-evolving telecommunications landscape.
According to new data from the Communications Authority of Kenya (CA) for the quarter ending September 2024, Equitel’s market share rose to 6.7%, edging out Telkom Kenya, which dropped to 5.9%.
This shift reflects Equitel’s growing appeal, largely driven by its seamless integration with Equity Bank mobile banking platform, which offers users convenient money transfers, access to credit, and bill payments through a single SIM card.
“Equitel’s growth is a testament to the power of financial technology in transforming mobile communications,” said James Mwangi, Equity Group CEO. “We’re not just offering voice and data—we’re enabling financial inclusion.”
What the Numbers Say
Between April and September 2024, Equitel gained over 400,000 new subscribers, pushing its total active users to 3.1 million. During the same period, Telkom Kenya lost 250,000 users, shrinking its base to 2.7 million.
The overall number of mobile subscriptions in Kenya stood at 66.5 million, with Safaricom dominating the market at 65.4%, followed by Airtel Kenya at 21.2%.
How Equitel Pulled Ahead
Equitel operates as an MVNO, riding on Airtel’s network infrastructure. This model has allowed it to avoid heavy capital expenditure on infrastructure, instead focusing on expanding financial services via mobile technology.
In the first half of 2024 alone, Equitel users transacted over KSh1.3 trillion (USD $8.6 billion) in mobile money services. Many customers cite lower transaction fees—compared to M-Pesa—as a key factor in switching.
“Our proposition is simple: financial services and communication should be seamless,” said Moses Nyabanda, Acting Managing Director at Equity Bank Kenya. “Equitel is that bridge—and the market is responding.”
Why Telkom Is Losing Ground
Founded in 1999 after the split of the Kenya Posts and Telecommunications Corporation (KPTC), Telkom Kenya has endured a tumultuous journey.
Despite government re-acquisition of a 60% stake in 2022, the company continues to grapple with legacy infrastructure issues, stiff competition, and an aborted merger with Airtel in 2020.
A Changing Telco Landscape
Industry leaders say Equitel’s rise reflects broader trends in the telecom space—where success is no longer defined by voice and SMS traffic but by integration with financial services.
“The future of telcos is about digital ecosystems, not just connectivity,” said Peter Ndegwa, CEO of Safaricom. “Equitel has shown that combining banking with telecom can change the game.”
With Kenya’s mobile penetration now exceeding 130%, the market is shifting towards fintech innovation and value-added services.
The Road Ahead for Equitel
Equitel’s ascent underscores Equity Group’s digital strategy, which includes significant investment in technology and data-driven banking. Its ability to scale mobile financial services efficiently has created a strong alternative to traditional telco models.
As Telkom Kenya continues to face uncertainty, Equitel is now well-positioned to challenge the dominance of larger players—particularly in the fast-growing mobile finance segment.
This development signals a new phase of competition in Kenya’s telecom sector—one where banking-led telcos could shape the future of how Kenyans connect, communicate, and manage money.
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