Nairobi Woman Challenges Safaricom Over M-PESA Fuliza Deduction

A Nairobi woman has moved to the High Court after KSh 2,700 she mistakenly sent via M-PESA was used to offset the recipient’s outstanding Fuliza debt.

Her request for a reversal was declined, prompting a constitutional challenge that could have far-reaching implications for Kenya’s digital finance ecosystem.

At the heart of the case is a simple but weighty question: When a person sends money, who ultimately has the right to determine how those funds are applied?

The petitioner argues that when she initiated the transfer, her intention was clear — to send money to a specific individual. She was not entering into a contract with Safaricom PLC to facilitate loan recovery. She was not consenting to act as a guarantor. Nor was she volunteering to settle another adult’s overdraft.

“How then,” she poses in her court filings, “does my money automatically clear someone else’s debt without my consent?”

The dispute arises from the workings of Fuliza, the overdraft facility linked to M-PESA accounts. If a recipient has an outstanding Fuliza balance, incoming funds may automatically be used to offset the debt before the user can access the money.

While the recipient may have agreed to Fuliza’s terms and conditions, the sender argues she did not — and that distinction forms the crux of the constitutional argument now before the court.
Legal observers say the matter raises broader concerns about consumer protection, transparency and property rights in automated financial systems. If a mistaken transfer cannot be reversed because the funds have already been absorbed into a debt recovery mechanism, critics warn it risks creating a precedent where corporate loan recovery is prioritised over third-party rights.

The petitioner contends that, at the very least, there should be explicit disclosure before a transaction is completed. A warning such as:

“The recipient has an outstanding Fuliza balance. Funds may be used to offset debt. Proceed?”

would allow senders to make an informed decision.
As Kenya continues to lead in digital finance innovation, the case tests how far automated systems can go without infringing on constitutional protections.

Though the disputed amount is KSh 2,700, the principles at stake extend far beyond the figure. The outcome could shape future safeguards in Kenya’s mobile money landscape — and redefine the balance between digital convenience and consumer rights.
This is a case worth watching.