Hubtel earns GH¢325m in ECG deal-Auditor-General -

Hubtel Limited has earned a total of GH¢325,014,144.27 in service fees over three years for collecting electricity revenue on behalf of the Electricity Company of Ghana (ECG), according to the Auditor-General’s 2024 report.

A total of GH¢223.9 million (GH¢223,908,900.29) has been paid to Hubtel while GH¢101.1 million (GH¢101,105,243.98) is outstanding.

The fees, which represent a 1.5% commission on every transaction processed, cover the period from 2022 to end of 2024.

GH¢75m paid without signed contract

The report reveals that in 2022 alone, ECG paid Hubtel GH¢75 million despite the absence of any signed contract agreement to justify the engagement of the company for its revenue collection services.

The Auditor-General noted that ECG Management failed to produce any documentation during the audit to support the transaction.

2023 payments top GH¢148m

In 2023, Hubtel received another GH¢148.9 million (GH¢148,908,900.29) as commission from ECG.

GH¢101.1m outstanding

In addition, ECG claimed it owed Hubtel a further GH¢101.1 million (GH¢101,105,243.98) in service fees for revenue transactions processed between 1 November 2022 and 31 December 2023.

However, ECG Management was unable to provide transaction records or a clear breakdown of how the figure was computed. The Auditor-General has therefore recommended the disallowance of the GH¢101 million claim, citing the lack of substantiating documents.

Contract signed retroactively without PPA approval

The report disclosed that ECG eventually signed a contract with Hubtel on 20 March 2024, with retroactive effect from 1 January 2023, for a five-year agreement to provide digital payment services.

The deal included the 1.5% commission rate on revenue collected.

Despite formalizing the arrangement in 2024, the Auditor-General flagged ECG for flouting procurement regulations.

The engagement was carried out through a single-source procurement method without prior approval from the Board of the Public Procurement Authority (PPA), in breach of the Public Procurement Act, 2003 (Act 663), as amended.

What Hubtel provides ECG

Hubtel’s role in the ECG revenue ecosystem goes beyond collections.

Payment solutions

Enabling ECG customers to pay electricity bills online through multiple channels such as mobile money and bank transfers.

Customer engagement

Sending SMS and other digital notifications to inform customers about bills, outages, and service updates.

Data management & analytics

Assisting ECG in managing customer databases, tracking transactions, and providing analytics to optimize operations and understand customer behavior.

These functions, according to the report, aim to modernize ECG’s revenue collection and customer service platforms. However, the lack of transparency and non-compliance with legal processes has overshadowed the technological advantages.