Hubtel, the Ghanaian fintech firm responsible for creating the ECG Power App, has denied claims that it received $25 million for the project from the Electricity Company of Ghana (ECG).
The denial follows allegations by civil society groups and some media outlets that Hubtel had claimed a $25 million payment, while ECG reportedly mentioned paying the company GHS 171 million.
Amid the controversy, ECG’s managing director at the time of the contract, Samuel Dubik Mahama, stepped down from his position and has been replaced.
However, Hubtel has issued a statement refuting all accusations surrounding the payment and any involvement in procurement irregularities.
“Hubtel has NOT been paid $25 million,” the company said in a statement shared with Techfocus24. “We have NOT claimed anywhere that we received such a payment from ECG.”
Project Costs and System Upgrades
Hubtel explained that the $25 million figure was originally set as a cost ceiling by ECG’s Board of Directors at the start of the project.
However, through efficient management and collaboration with other service providers, ECG ultimately spent around $12 million (GHS 171 million), which covered a range of system improvements beyond the Power App itself.
The statement noted that these funds were used to address multiple challenges at ECG, including upgrading outdated systems responsible for revenue losses and frequent downtimes. Key upgrades included:
Migration of ECG’s core databases from Oracle 10G to Oracle 19C.
A new balance management and accounting system.
Enhancements to metering and customer service infrastructure.
Upgrades to staff systems for commercial operations.
Improvements in revenue protection systems.
The ECG Power App, which is designed to streamline payments for electricity, was just one aspect of the broader set of upgrades funded by the project.
Clarification on Transaction Fees
Hubtel also responded to allegations that it receives a 3% commission on every transaction made through the Power App. The company clarified that it charges a 1.95% fee on all transactions processed through its platform. Of this, 0.95% goes to Hubtel, while the remaining 1% is retained by mobile money operators and card scheme providers such as Visa and MasterCard.
The company further explained that other transaction costs, such as cloud infrastructure for meters and next-day settlement fees, are handled by upstream providers and are unrelated to Hubtel’s own fees.
Addressing contract length misconceptions
Regarding the duration of its contract with ECG, Hubtel dismissed claims that it spans 30 years, confirming that the actual agreement is for a five-year term.
Revenue Growth Achieved Through Partnership
Critics have also questioned whether Hubtel’s involvement has led to tangible improvements in ECG’s financial performance.
In its response, Hubtel highlighted a significant increase in revenue since the introduction of its services. The company reported that monthly revenue has grown by over 210% compared to figures from August 2022, marking the longest sustained period of revenue growth in ECG’s history.
Even accounting for the recent 80% tariff hike, Hubtel noted a net monthly revenue increase of around 72%, which represents a record growth since 2001. This surge in revenue has enabled ECG to better manage its obligations to suppliers, the company said.
Rebuttal to Political Ownership Allegations
In addition to the financial and operational clarifications, Hubtel also addressed rumours that it is owned by political figures. The company stated emphatically that at no time since its founding have any of its shares been held by government officials or individuals affiliated with political parties. Furthermore, Hubtel has never had a contract with the Government of Ghana.
Proud of its role in the development of Ghana’s digital economy, Hubtel reiterated its commitment to transparency and good governance. The company reassured the public that its work with ECG has consistently followed these principles.
“We are proud of the work we have done for ECG and Ghana, and we remain committed to upholding the values of integrity and transparency in all our dealings,” the company concluded.