Telkom Kenya, the third biggest telco in the country, lost 1.62 million subscribers between March last year and June this year amid the latest crackdown on irregularly registered SIM cards.

An analysis of official data shows that the telco had 2.25 million active subscribers as at June, a 39 percent dip from 4.14 million subscribers in March last year.

The Communications Authority of Kenya (CA) started switching off SIM cards that were not regularly registered from April last year— being the latest in an exercise that has been frequently undertaken since 2013.

Telkom Kenya is the only telco that lost subscribers in the wake of the crackdown, further hurting its ability to keep pace with market leader Safaricom and the second biggest firm in the industry, Airtel.

The crackdown slowed new subscriptions even as Safaricom and Airtel grew their active SIM cards by a combined 2.83 million between March and June, pushing the total number of active customers to 66.43 million from 64.96 million in March last year.

“The slow growth in mobile subscriptions during the year is attributed to the SIM registration exercise that kicked-off in February 2022 with a deadline of October 2022 which resulted in deactivation of unregistered SIM cards,” the CA says in the latest industry report.

Telkom has over the years struggled to keep pace with Safaricom and Airtel in the race for the local telecommunications market and the dip in active customers will significantly dent their revenues from calls, SMS and mobile money among other transactions.

Equitel and Jamii Telecom grew their active customers by 264,890 in the period under review to hold a combined 1.91 million active users as at June.

Telcos were required to re-register their subscribers by updating their details with a digital passport-size photo of the customers in the wake of the CA's directive.

The CA says that irregularly registered SIM cards are used to perpetuate crime, including money laundering, kidnapping, malicious calls, cybercrime and mobile money fraud.

The government enhanced rules and fines for the use of unregistered SIM cards and those irregularly registered following the September 2013 attack on Westgate Mall.

Terrorists used unregistered SIM cards to coordinate the attack prompting the CA to conduct a crackdown the same year.

Breach of the SIM card registration rules attracts a maximum fine of Sh500,000 or a year in jail or both for street vendors, while mobile operators are liable to a fine not exceeding Sh5 million.