Kenyan Tech Boss to Sue PayPal

Veteran tech entrepreneur Sam Gichuru is looking to lead Kenyans in suing global digital payments giant PayPal, over its holding of funds belonging to users. As Business Today has previously reported, Kenyan users of PayPal – especially freelancers, developers and remote workers – have long borne the brunt of decisions by PayPal to hold funds due to transactions it deems suspicious.

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In many cases, Kenyans offering legitimate services online end up unable to access payments made by clients to their PayPal accounts. The US-based company’s decisions to hold funds have seen numerous Kenyans fail to pay crucial bills. PayPal, on the other hand, states that it only holds payments when “there’s a higher than average risk associated with the payment”.

Gichuru, founder of tech incubator Nailab and edtech startup Kidato, on Sunday, July 9, sought to rally Kenyans who had had their funds held to sign up to join his legal effort. His request received an overwhelming response from Kenyans who recounted their difficult experiences with the payment service.

“Are Kenyans still struggling to withdraw their money from PayPal? I am. It’s been over 2 years,” he tweeted.

Gichuru disclosed that he would bring on board lawyers to take the suit forward. He revealed that he had personally faced a fruitless pursuit of his funds on PayPal for the past two years.

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According to the Online Labour Index (OLI), an economic indicator that measures the global online gig economy, Kenya accounts for 1% of the world’s online freelance workforce, ranking 15th overall and second only to Egypt in Africa. About 70% of online freelancers in Kenya offer writing and translation services. This explains why many Kenyans use PayPal to receive payments for the services they offer digitally to clients around the world.

Many who responded to Gichuru’s request disclosed that they had been unable to access as much as $4000 on PayPal due to their limited accounts.

“Great initiative for sure I lost some also but it is merely not that much for legal action. At the time it was my food though so it meant a lot then. Hope you succeed,” shared @sir_huhu.

“I can’t imagine the cumulative amount of money they are holding and trading with from Africans. Such a pathetic company PayPal is. Zero remorse. Zero integrity. Very unethical behavior,” wrote @MutiaMule.

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