Sunday, July 12, 2020

Kenyans turning to mobile loans in times of COVID-19

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Kanika Bajaj

Article Title

Kenyans turning to mobile loans in times of COVID-19

Publisher

Global Views 360

Publication Date

July 12, 2020

URL

People of Kenya

People of Kenya | Source: Flightlog via Wikimedia

The economic impact of COVID-19 is felt on the personal finance of people across the world who are looking for ways to tide over the situation. In Kenya, people are lapping the short-term credit in the form of digital loans by mobile money operators. The number of people taking digital loans has doubled during the COVId-19 induced lockdown period.

Boston Consulting Group's Consumer Sentiments Survey conducted in April and May 2020 reported that "In May, 29 percent responded that they had taken out a short-term loan, compared to 16 percent in April. Mobile money operators were the most common sources of this credit”

Kenya is a pioneer in using mobile money transfer services as the key tool for providing financial inclusion to its citizens. A simple money transfer service, M-PESA launched in 2007 has transformed the financial service industry in Kenya. Today mobile money operators are providing multiple services like digital loans, marketplace for small businesses and farmers.

Digital loans are easy to process and disbursed but there are concerns of shaming the defaulters and compromising the data security of clients. The Digital Lenders Association of Kenya (DLAK) which is a body representing the digital lenders of Kenya has distanced from two of their members, Okash and Opesa over unethical practices. These mobile apps have shared the details of defaulting customers with the moneylenders and asking them to recover the money.

DLAK also stated that Opesa and Okash are known for attacking a client's data privacy which is against the Kenyan data protection laws and has additionally spoiled the reputation of digital leaders in Kenya.

In April 2020, Central Bank of Kenya barred unregulated digital mobile lenders from forwarding the names of loan defaulters to credit reference bureaus. A huge number of Kenyans have been recorded on Credit Reference Bureaus by digital money lenders for loans as little as $5.

Central Bank of Kenya governor Patrick Njoroge told during a press conference in May 2020 that the central bank in consultation with the mobile money operators and digital lenders is presently working to develop a model where the borrowers are protected from mistreatment of online moneylenders.

The borrowers are looking up to the regulatory authorities and the industry bodies to come up with a mechanism which will protect their interest in times of such a health and economic emergency.

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February 4, 2021 4:49 PM

Has Canada’s stand on Israel-Palestine conflict cost it the UNSC Seat

On the 17th of June, 2020, Canada lost its bid for a temporary seat in the UN Security Council, the only UN body which can put binding resolutions on the member countries.. In the competition were Norway and Ireland, which won by 130 and 128 votes respectively where the votes required to secure a seat were 128. Canada, however, fell short by 20 votes.

It is a jolt to Canadian Prime Minister Justin Trudeau who had declared “Canada is back” to the world stage after the conservative government. He had personally campaigned for the seat but Canada received even fewer votes than what it received in 2010 under the conservative government of Stephen Harper. That is why Bessma Momani, a senior fellow at the Centre of International Governance and Innovation, calls it “embarrassing” and a “bit of a wake-up call.”

There have been many mixed reactions within Canada on the reason for the loss as well as the significance of this loss.

A professor at the Munk School of Global Affairs at U of T, Jance Stein, talks about how Canada in UNSC would have got trapped in the crossfire between US-Canada clashes. Andrew MacDougall, the ex-director of communications with the former PM Harper, says “UNSC hasn’t been relevant to global peace and security for more than 15 years”, implying that UNSC seat is not worth much.

There have been many reasons ascribed to the loss, the first and foremost being Canada’s staunch support of Israel. Canada has voted 116 times against UN resolutions for Palestinian rights, against Israel’s occupation, since 2000. It has also not opposed Israel’s planned annexation of the Jordan valley. “Just Peace Advocates” in association with over a hundred non-governmental organizations sent a signed letter to UN members countries, urging them to consider Canada’s votes against Palestinian refugees and illegal settlements while deciding on their votes for UNSC seat. It also pointed out how Canada considers Israel’s illegal territories as a part of it in trade, which is directly against UNSC Resolution 2334 which calls on member states to distinguish between Israel and its new territories occupied in 1967. As majority of the countries in UN show support for the Palestinian cause of a separate state and the well being of the war-wreckin Palestinian citizens, Canada’s unwavering support for Israel might have contributed to its defeat in winning UNSC seat.

Tamara Lorincz, a member of the Canadian Foreign Policy Institute pointed towards a more fundamental issue with Canadian foriegn policy management. He talked about how Canada hasn’t drafted a foreign policy to explain its stances on important global issues, hasn’t set aside enough funds for overseas development aid, has exported weapons to countries like Saudi Arabia, has snubbed negotiations on a treaty against nuclear weapons and many other shortcomings which make it undeserving of the seat.

This development, however, is beneficial for the Palestinians, since Canada would have supported Israel in the UNSC and opposed all such resolutions which may favour Palestinians and are critical to Israel. This loss may also force Canada to give a serious rethink to its Israel First policy. According to a poll by EKOS Research Associates, three in four Canadians want their government to oppose Israel’s annexation plans and 42% of them wanted sanctions against the country. There is also a campaign in Canada which calls on the Prime Minister “to fundamentally reassess Canadian foreign policy.”

It is too early to predict whether the loss of the UNSC seat will trigger some introspection in the foriegn policy circles of Canada or it will be business as usual.

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