Kenyans failed to claim loyalty points commonly known as Bonga Points worth Ksh3.94 billion in the full year ended March 2020, Safaricom’s annual report shows.
The Ksh3.94 billion amount is a rise from the Ksh3.85 billion posted the previous year during an year when the company allowed customers to redeem the loyalty points for household items and food.
Some one billion points valued at Ksh301 million were redeemed in the two months ended June 4 through the Bonga for Good initiative.
The initiative, in which one point converts to 30 cents, was launched on April 3 to help customers purchase goods and services in the wake of the economic disruption brought by the COVID-19 p******c .
Safaricom has been pushing for points redemption since they are accounted for as a liability or deferred income in the telco’s books and only recognised as revenue once customers utilise them.
“Management defers revenue for every point accumulated and recognises the revenue relating to the points earned on redemption,” says Safaricom in the latest annual report.
The scheme, introduced in January 2007, gives subscribers one Bonga point for every Ksh10 spent.
A customer can then redeem the points for data, airtime or SMS. If a user accumulates alot of bonga points they can trade the loyalty points plus some little cash for a phone at Safaricom shops.
Enterprise business customers also earn loyalty points when they achieve their revenue targets and redeem the points after revenue contracts with the Safaricom.
The telco uses the same concept to recognise airtime revenue. Prepaid airtime sold to customers is held as deferred revenue until the customer uses it. Unused airtime and data bundles by prepaid customers was at Ksh2.5 billion at the end of March, being the same as in the previous year.