BUSINESSSMART BUSINESS

Why Kenyans Are Turning on Their Banks

Share
Share

Hidden charges, high transaction costs and problematic digital banking services are sparking a wave of discontent among the customers of Kenya’s biggest banks.

The January 2023 return of bank to mobile money transaction charges suspended at the height of Covid-19 two years ago has opened a can of worms, sparking a discussion on the things Kenyans don’t like, and don’t know, about their banks. Interestingly, it is emerging that many Kenyans are unfamiliar with the various charges they incur – ranging from the SMS alert fees some banks charge for each for credit/debit transaction notification, ATM withdrawal fees, annual account charges and transactions on various mobile banking apps.

Banks’ online customer care channels have been scrambling to respond to countless queries from frustrated Kenyans in recent days. In some instances, customers have even vowed to leave their banks for less expensive and more transparent alternatives.

How well do you know how much your bank charges you? In most cases, obscure terms and conditions include details and costs that many fail to read before making various transactions or opening an account.

Hidden charges are nothing new in Kenya. In 2021, for example, the Competition Authority of Kenya ordered 12 banks to review their mortgage contracts which were deemed unfair.

READ>Deadline to Import Cars from 2015 and Earlier is Here – What You Should Know

A CAK review of  home loans contracts offered by 27 banks found 12 to be in breach of regulatory provisions. The information provided to customers was deemed incomplete, unclear, and unfavourable.

It was established that hidden costs for origination, booking, valuation, mortgage and title transfer, commissions, brokers’ fees, legal fees, insurance and stamp duty can drive up the mortgage rate by over 10 percent.

The 12 lenders whose contracts were deemed unfair included KCB Bank, NCBA Bank, Absa Bank Kenya, DIB Bank Kenya, Mayfair Bank, Consolidated Bank, Victoria Commercial Bank and Bank of Baroda.

It is important to read the terms and conditions carefully before entering any contracts with financial institutions. You should also purpose to make official enquiries whenever you are unsure of charges you are incurring.

You can also file a consumer complaint with the Competition Authority of Kenya (CAK) over the practices of your bank, or reach out to the Central Bank of Kenya (CBK). In cases of fráud, you can file a report with the DCI’s banking fráud unit.

NEXT READ>Chicken Is The Most Ordered Item In 2022 – Bolt Report

 

Written by
BUSINESS TODAY

editor [at] businesstoday.co.ke

Leave a comment

Leave a Reply

Your email address will not be published. Required fields are marked *

PAST ARTICLES AND INSIGHTS

Related Articles
Uchumi is one of the speculative counters at the NSE
BUSINESSFEATURED ARTICLESTOCKS

NSE: How to Trade Penny Stocks

NSE speculative investors have occasionally traded in penny stocks, these are cheap...

Thwake Dam receives additional funding after Cabinet Approval
AGRICULTURE

Thwake Multipurpose Dam Receives Additional KSh12.8Bn After Cabinet Approval

Thwake Multi-Purpose Dam, considered Kenya’s largest earth dam, which has stalled for...

NSE closes the week on a mixed note
ANALYSISBUSINESS

NSE Closes the Week on a Mixed Note as October Rolls Out

NSE(Nairobi Securities Exchange) closed its trading week today on a mixed note...

Nairobi Coffee Exchange
AGRICULTUREBUSINESS

NCE Auction Opens New Season with Sale of 17,084 bags Worth KSh 801Million

NCE (Nairobi Coffee Exchange Auction) begun its new trading session on Tuesday,...