Judge backs Safaricom in M-Shwari legal case

Judge backs Safaricom in M-Shwari legal case

A Kenyan micro-finance provider has failed in its legal bid to have Safaricom's M-Shwari mobile banking service shut down pending the outcome a court case, according to local press reports.

Having hit gold with its hugely popular M-Pesa mobile payments service, last year telco Safaricom moved to broaden its financial services remit by partnering with Commercial Bank of Africa (CBA) to launch a banking service, offering interest-bearing deposit accounts and loans.

However, microfinance outfit Faulu Kenya quickly went to court, claiming copyright infringement and breach of agreement, says the Daily Nation newspaper. Faulu argued that it developed a cash advance system for use over mobile networks and had teamed up with Airtel Networks on a service dubbed Kopa Chapaa.

Faulu also sought an injunction to shut down M-Shwari pending the outcome of the main suit but a judge has now dismissed this, deciding that Faulu failed to prove that it owned a copyright, says the Daily Nation.

Safaricom and CBA are now free to continue offering their service, although Faulu continues to pursue its main suit.

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