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 4:54 PM

A Timeline of Political Instability in the Indian state of Rajasthan

A recent political crisis in the Indian state of Rajasthan has brought with it a storm of internal instability. Perhaps the biggest question on the mind of most political analysts and politicians, amidst this, is the anticipation—or hope— that Sachin Pilot, ex-Deputy Chief Minister of Chief Minister in Rajasthan, will announce his departure from the Indian National Congress (INC) and join the Bharatiya Janata Party (BJP). The central BJP government has garnered quite a reputation for toppling state governments in regions where the oppositional party Congress forms the majority.

But focusing on the BJP might be taking everyone’s eyes away from the big picture: a story that is, for now, about more than possible BJP interference. Consider what the crisis tells the citizens of India about Congress’ national and state level handling of ‘political drama,’ as the series of events continue to unfold.

July 10, 2020: Pilot is summoned by the Special Operations Group (SOG) of the Rajasthan Police in regards to an FIR registered against him on an alleged attempt to dislodge the Gehlot government in recent Rajya Sabha polls through horse-trading; however, the root of discord may have been sown long before that.

July 11, 2020: The Chief Minister (CM), Ashok Gehlot claims the BJP is trying to overturn his government by bribing MLAs.

July 12, 2020: The Dy Chief Minister, Sachin Pilot claims 30 MLAs have ‘pledged support’ to him, making the present government a minority. Ashok Gehlot responds by claiming it has 109 MLAs; Pilot seen with BJP leader Jyotiraditya Scindia in Delhi as he and his supporters move in and around Delhi and Gurgaon.

July 13, 2020: INC issues whip for Congress Legislature Party (CLP) meeting at CM’s residence where it passes a resolution to support Gehlot and take disciplinary action against MLAs and office-bearers who ‘weakens party’; Congress also says that ‘doors will remain open’ for Pilot and his aides; Pilot does not attend the meeting, and those who do are transported to Fairmont Hotel in Jaipur to avoid any ‘potential crossover.’

July 14, 2020: INC calls for a second CLP meet, which is once again not attended by Pilot; Pilot is removed from his positions as the Deputy Chief Minister and President of State Congress Committee of Rajasthan, along with 18 other MLAs who supported him; a plea is filed in Rajasthan High Court against the disqualification notices; 2 MLAs from Bhartiya Tribal Party (BTP) withdraw support from Congress, but hand over letters of support to Ghelot four days later on July 18; the BJP demands a floor test, but later denies this claim.

July 15, 2020: Pilot confirms he is not planning to join the BJP.

July 16: News of leaked audio tapes start surfacing, reportedly proving a conspiracy to topple the Gehlot government; FIRs are lodged.

July 17, 2020: Harish Salve, representative of ‘Pilot camp’ in Rajasthan HC, argues that the rebel MLAs have not resigned, yet they were issued disqualification notices under Paragraph 2(1)(a) of the Tenth Schedule, which is only applicable in case of resignation; 2 rebel MLAs are suspended by Congress over their alleged involvement in leaked audio tapes; an arrest is made by SOG in regards to horse-trading probe and leaked audio tapes.

July 18, 2020: BJP levels allegations of phone tapping and demands Central Bureau of Investigation (CBI) probe in relation to leaked audio tapes; two days later the Rajasthan Government notifies via circular that it has revoked general consent to CBI that is needed for investigations, and consent will now be sought on a case by case basis.

July 19, 2020: SOG reaches Manesar to question one of the rebel MLAs claimed to be named in leaked audio tapes; Gehlot forms probe to investigate audio tapes.

July 20, 2020: Giriraj Singh Malinga, a Rajasthan MLA from INC, claims that he was offered Rs. 35 crore by Pilot to join the BJP, Pilot responds by saying he is ‘sad but not surprised’ at what he considers to be fabrications intended to damage his reputation; Ghelot remains convinced that Pilot is ‘hand in glove’ with the BJP; meanwhile in Rajasthan High Court, the judges observe that a whip cannot be issued with respect to a party meeting, but only for an Assembly session.

July 21, 2020: Hearing of petition ends, Rajasthan High Court says it will announce the verdict on July 24 and the Speaker cannot act on the disqualification notices until then; Third Congress Legislature Party begins at Fairmont Hotel.

July 22, 2020: Rajasthan Speaker CP Joshi moves Supreme Court in order to challenge the stay order of the High Court.

July 23, 2020: SC allows Rajasthan HC to continue passing orders as scheduled; says it will begin hearing the Speaker’s plea from July 27.

July 24, 2020: Rajasthan HC orders that a “status quo” be maintained and defers its judgement until SC makes a decision; Speaker will not be allowed to act on disqualification notice until both courts pronounce their verdicts; Rajasthan HC allows the Union of India to be made a party in the case; ‘Gehlot’s camp’ organise a dharna at Raj Bhawan demanding an Assembly session, and Gehlot meets Governor Kalraj Mishra regarding the same.

As the situation gets more complex and drawn-out, the question of the BJP government’s involvement is still up in the air. The crisis currently presents itself as a mishandling on Congress' part at the state and national level, perhaps stemming from younger leaders not seeing eye-to-eye with the veterans.

The insatiable hunger for power by any means displayed by the BJP- despite its claims of non-involvement- in seeing the current government toppled cannot and should not be overlooked. Speculations run abound, and at the end of the day it might just be up to the citizens to peer through the fog and infer for themselves the roles and intentions of the embroiled parties.

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