Kenya IGF Online Discussions. Day 3. Developments in Fintech and E-commerce

@Grace I guess so. But when you also flip it as a follow up to yesterday’s
discussion, we are also being driven to a situation where if you don’t have
any data available about you,
then, it is not possible to get any financial help.
So, I guess as technology continues to evolve so will people be required to
do lots of things to fully benefit from it.

*Kind Regards,*

*David Indeje *

+254 (0) 711 385 945| +254 (0) 734 024 856 Khusoko
<bit.ly/2eJF9B4>

<www.facebook.com/DavidIndeje/>

<ke.linkedin.com/pub/david-indeje/17/7b9/647> Skype: david.indeje

On Thu, 12 Jul 2018 at 10:19, Grace Bomu <nmutungu@gmail.com> wrote:

> @ Indeje, I wonder whether we are being driven to a “you must have a
> credit score” world and thereby a situation where one might have to take a
> loan just to get a credit score.
>
> 2018-07-12 10:12 GMT+03:00 David Indeje via kictanet <
> kictanet@lists.kictanet.or.ke>:
>
>> As regards 3. How about the Credit Reference Bureaus? Are they stuck in
>> a time warp or is the legislation in place encumbering them from
>> innovation?
>>
>> I once spoke to KBA’s Dr. Habil Olaka and he noted that the CRB’s role in
>> the market has not been achieved as it is currently constituted.
>> According to him, CRB was not to play the role of blacklisting persons
>> who have defaulted but rather to inculcate an environment where people
>> become responsible and
>> similarly,
>> help financial institutions to better price a person who is seeking
>> financial help.
>>
>> This is a reason that led to the launch of the Loan Calculator by the
>> KBA. There reasoning was it is better to get a loan from a bank rather than
>> the mobile lending platforms.
>> However, in line with what @GraceBomu notes on mobile lending, FSD in
>> their 2017 report <fsdkenya.org/annual-report/2017-annual-report/>
>> recommended that “As the market for digital loans grows and diversifies,
>> further research is needed to help build a more complete and timely picture
>> of how and whether these products can improve Kenyans’ lives.”
>>
>> On Regulation: CBK has the best answer on how it regulates mobile
>> lending institutions so that they are differentiated from the banks.
>> However, I agree with BBK MD Jeremy Awori who says “Excessive control and
>> regulation does not help the market. This is adding a lot of bureaucracy
>> and cost, which will find its way to the charges of products” he spoke this
>> yesterday.
>> Same sentiments have been raised by Safaricom and also the CBK
>> <www.businessdailyafrica.com/markets/marketnews/Proposed-finance-law-will-cripple-CBK–says-governor/3815534-4585524-dt5vtiz/index.html>
>> as regards to the new Financial bill
>>
>>
>> *Kind Regards,*
>>
>> *David Indeje *
>>
>> +254 (0) 711 385 945| +254 (0) 734 024 856 Khusoko
>> <bit.ly/2eJF9B4>
>>
>> <www.facebook.com/DavidIndeje/>
>>
>> <ke.linkedin.com/pub/david-indeje/17/7b9/647> Skype:
>> david.indeje
>>
>>
>> On Thu, 12 Jul 2018 at 09:47, Grace Bomu via kictanet <
>> kictanet@lists.kictanet.or.ke> wrote:
>>
>>> Hi Ali,
>>> ​With regard to the question of mobile money lending, it is a subset of
>>> micro finance in many ways. It definitely ​leads to more financial
>>> inclusion for the unbanked and provides credit to those who would normally
>>> not be targeted by banks. However, the interest rates are sometimes so high
>>> that one wonders if the goal is financial inclusion or bondage through
>>> credit. There needs to be more transparency by the lending apps not only
>>> about their rates but how these are derived, what data they hold and for
>>> how long. The money lending apps are also marketed in isolation from other
>>> important information that one needs in order to make the most out of
>>> credit. In comparison to microfinance for example, the institutions take
>>> time to educate borrowers about finance, business plans, loan repayment
>>> plans etc. There are also social structures like women groups or SACCO
>>> groups that assist borrowers to reach their goals with the money they
>>> borrowed. This is a gap with mobile money lending apps which are more
>>> impersonal and agnostic about the purposes for borrowing.
>>>
>>>
>>> ​Regards​,
>>>
>>>
>>>
>>> Il giovedì 12 luglio 2018, Ali Hussein via kictanet <
>>> kictanet@lists.kictanet.or.ke> ha scritto:
>>>
>>>> Dear listers.
>>>>
>>>> Since the advent of Mpesa, Kenya has been recognized as Ground Zero for
>>>> Mobile Money/Payments Innovation the world over. According to a World Bank
>>>> report one in every ten human beings regularly using mobile money is a a
>>>> Kenyan.
>>>>
>>>> Over the last few years Fintech (Financial Technology) has become all
>>>> the rage. American startups are setting up in Kenya. The more common ones
>>>> that we know are Branch and Tala who combined have raised over $150m of
>>>> venture funds in the last few years. These two are mainly mobile lending
>>>> platforms. Insuretech is taking root. Payment Platforms are proliferating.
>>>> Banks are jumping onto the Fintech Bandwagon with mainstream banks like
>>>> Barclays and HF Group launching their mobile lending apps. Equity Bank
>>>> boldly announced a few weeks ago that they are building an API Bank.
>>>> Banking as a Service as it were.
>>>>
>>>> Not to be left out, Blockchain and it’s offspring, Bitcoin is threading
>>>> to complete the upheavals in the financial sector. On top of it all the
>>>> government is playing catch up on regulation with the announcement of the
>>>> Finance Bill 2018. See analysis from KPMG on this.
>>>>
>>>>
>>>> home.kpmg.com/ke/en/home/insights/2018/06/finance-bill-2018-analysis.html
>>>>
>>>> To ponder:-
>>>>
>>>> 1. Are we moving too fast? Is there a need to take a chill pill and
>>>> reflect on the gains and achievements of the sector? Should we regulate
>>>> lightly or heavily?
>>>>
>>>> 2. Should we regulate and cap the mobile lending platforms? Are they
>>>> playing a crucial role of financial inclusion or are they just loan sharks
>>>> on steroids?
>>>>
>>>> 3. How about the Credit Reference Bureaus? Are they stuck in a time
>>>> warp or is the legislation in place encumbering them from innovation?
>>>>
>>>> 4. Lastly is the BlockChain conversation being overhyped? And how do
>>>> you separate the technology from the cryptocurrencies it spawns?
>>>>
>>>> Over to you Listers.
>>>>
>>>> *Ali Hussein*
>>>> *Principal*
>>>> *AHK & Associates*
>>>> +254 0713 601113
>>>>
>>>> Twitter: @AliHKassim
>>>>
>>>> Skype: abu-jomo
>>>>
>>>> LinkedIn: ke.linkedin.com/in/alihkassim
>>>>
>>>> “We are what we repeatedly do. Excellence, therefore, is not an act but
>>>> a habit.” ~ Aristotle
>>>>
>>>>
>>>> Sent from my iPad
>>>>
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>> The Kenya ICT Action Network (KICTANet) is a multi-stakeholder platform
>> for people and institutions interested and involved in ICT policy and
>> regulation. The network aims to act as a catalyst for reform in the ICT
>> sector in support of the national aim of ICT enabled growth and development.
>>
>> KICTANetiquette : Adhere to the same standards of acceptable behaviors
>> online that you follow in real life: respect people’s times and bandwidth,
>> share knowledge, don’t flame or abuse or personalize, respect privacy, do
>> not spam, do not market your wares or qualifications.
>>
>>
>
>
> —
> Grace Mutung’u
> Skype: gracebomu
> @Bomu
> PGP ID : 0x33A3450F
>
>

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