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Atwoli Takes On Fuliza And Digital Loan Apps

The trade unionist wants a crackdown on the digital microfinance sector in Kenya

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Central Organization of Trade Unions (COTU) boss Francis Atwoli on Tuesday, November 9 became the latest voice to advocate for stricter regulation of digital finance services including Safaricom’s Fuliza.

Atwoli cited petitions from numerous COTU members on the apps which have been accused of predatory lending with high interest rates, debt shaming and other unethical practices. The trade unionist called for a crackdown on the digital microfinance sector in Kenya by the Central Bank of Kenya (CBK) and the National Assembly.

“With most banks having their interest rates between 12% to 14% per annum, most of the digital lending facilities have interest rates of between 70% to 500% per annum. Just to mention a few, Fuliza by Safaricom, which has pushed many Kenyans into owning more than one sim card from the same mobile operator, has an interest rate of 1% per day and more than 360% p.a.”

“Other mobile lenders have an interest rate of 25% after every two weeks while others 33% for every week. This is ridiculous and unacceptable and no amount of ‘risk factor’ can substantiate this kind of banditry,” he stated.

Former United Nations Council on Trade and Development (UNCTAD) Secretary-General Mukhisa Kituyi, a 2022 Presidential aspirant, has made regulating the digital finance sector a key part of his platform. He thanked Atwoli for “joining the campaign against extórtion by micro-finance institutions in Kenya.”

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“The rise of digital micro finance is bankrupting poor Kenyans. With a minimum of 72% interest p.a. it is transferring the earnings of the poorest to the shareholder value of the richest. Central bank and CSR should stop this extórtion forthwith,” Kituyi had earlier opined.

Atwoli sought to appeal to Central Bank Governor Patrick Njoroge to rein in the digital lenders exploiting Kenyans. He described the practices of digital lenders as illégal,  immoral and ungodly.

“It is immoral for anyone to take advantage of the tough financial situations that Kenyans are going through to reap maximum benefits,” he asserted.

The Central Bank (Amendment) Bill, 2021, which was approved by the National Assembly Finance and Planning Committee in August seeks to place digital lenders under the ambit of CBK much like banks and micro-finance institutions, allowing CBK to regulate among other things, pricing of digital loans, sharing of borrowers’ information and management of digital lending firms.

Atwoli urged Parliament to come up with legislation “to facilitate the crackdown on the rogue digital microfinance sector in Kenya”.

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MARTIN SIELEhttps://loud.co.ke/
Martin K.N Siele is the Content Lead at Business Today. He is also a Quartz contributor and a 2021 Baraza Media Lab-Fringe Graph Data Storytelling Fellow. Passionate about digital media, sports and entertainment, Siele also founded Loud.co.ke
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  1. It’s a willing buyer and a willing seller. Nobody has been forced or coerced to take money from anywhere.

    Atwoli should stop shouting unnecessarily, take a true picture of the reality on the ground.

    Don’t politicise everything bwana SG, and don’t think Kenyans have been exploited. Some kenyans have bad habits when it comes to borrowing.
    Advise Kenyans to stop multi-borrowing , once they borrow they should be ready to pay back.

    Find an alternative way of wooing votes for Raila odinga, but don’t demean people’s business

  2. The monied will ostracize Atwoli. For once, I agree with mzee coz what justifies a 360% interest. By imagining that a 1000 bob is insignificant, just watch what Arati found in Kisii when he was apparently launching his gubernatorial bid. The promising of the handout brought thousands to queening mind you, over 70 years.
    That is the much value Kenyans who fuliza take the cash seriously.
    All digital lenders are no different from mainstream banking lenders so they should not be treated differently despite the targeted borrowers

  3. I fully agree with Atwoli. Even if it is business these apps oppress and demean people!! High interest rates!!

  4. Must RAO name appear everywhere despite him being a perennial loser though this time around he’s losing the last time then retire for good

  5. This digital lenders are thugs and very unprofessional. . They should not be allowed to do this kind of business in a country where there is good governance… They are simply taking advantage of the economic situation in the country to steal from Kenyans …They are real criminals …Behaves like people who never went to school while pushing for a payment…

  6. Atwoli should mind his trade union business and leave the financial sector alone. The micro finance lenders are filling up a vacuum that already exists. The money lent is usually a short term loan with no security which the mainstream banks do not lend.
    It should be left to the market forces and borrowers discipline.
    These micro loans help small traders in more practical ways than the government or any institution can.
    If innovations like mpesa were left to people like Atwoli Kenya would not have led the world in mobile money but thanks to forward looking people like Professor Ndungu and Michael Joseph.

  7. I agree with Atwoli 100%. Why the government allows this obviously illegalities to exist is beyond itself. ALL businesses should and must be regulated failure to which. It becomes man eat man. Nobody should be allowed to charge an interest of more than 1% per month whatever their reasons!. Being a unbanked space is not an excuse to make the poor toil for the app owners. Fight Atwoli fight!! You are talking care of your workers.

  8. I really agree with Mr Atwpli all companies should be lower there Interest upto 1% so that comon Kenyan citizen should upgrade their business

  9. This is a total stealing you cannot be given 30000/= then they expect you to pay back within 8days kwenda kabisa

  10. I totally agree with atwoli ..these digital lenders are thugs ..how can u lend 1500 and expect me to pay 2000 for a period of one week ..it will never happen ..these interest rates are very high
    Na tusitishwe sisi

  11. Mr.Atwolis is 100% correct. The money lenders are really killing the poor.The way they treat clients are unprofessional full of threats..texting everyone in your phonebook. If this is not tackle…i believe there will be many casualties of heart attacks

  12. This rogue digital lenders with skyrocketing interest rates should be Controlled by the CBK without delay,,Common sense should Not think Twice ,Kenyans are Not Money Minting enterprise, and really Kenyans are becoming Slaves of this Microfinance digital Platform. Legislature should come clean and table a Bill to regulate this Ogres,otherwise millions of Kenyans will die Young within some few Years,that’s with stress and becoming Slaves of this Monsters of Gold diggers.

  13. Some are good must be left but others they should be at kamiti maximum prison for extortion eg ,Tala, Fuliza, loan cash, good ones are eg, Branch, ,co operative mobile loan and Airtel mobile loan.

  14. this mobile lenders are pure thiefs , with alot of brokers inside and conmen.this kind of bussiness should not be allowed here in kenya. to hell

  15. I support what Atwoli is saying,many Kenyans have become debtors and poor, thought the CEO of Safaricom is saying it’s offering financial solutions, but the effects are adverse.


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