Uhuru - Kenya’s FDI increased from Shs 35 Billion to 200B

[RV Pundit]

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[hk]

Most of that FDI is  in what sector? Is it fintech and mobile gambling? Last yr tech attracted $350m https://www.businessdailyafrica.com/datahub/Kenya-nets-Sh35bn-in-tech-start-up-funding--outpaces-SA--Nigeria/3815418-5083844-11asclk/index.html but the bulk of it was in the shylock called fintechs. Such FDI and betting are just sucking out cash from poor kenyans.

[RV Pundit]

If they are sucking cash - they would be net capital outflows. They are meeting a need - fintech are doing a great job - and they charge interest based on the risk they are taking. That is want you want with repeal of credit freeze.

Most of that FDI is  in what sector? Is it fintech and mobile gambling? Last yr tech attracted $350m https://www.businessdailyafrica.com/datahub/Kenya-nets-Sh35bn-in-tech-start-up-funding--outpaces-SA--Nigeria/3815418-5083844-11asclk/index.html but the bulk of it was in the shylock called fintechs. Such FDI and betting are just sucking out cash from poor kenyans.

[hk]

If they are sucking cash - they would be net capital outflows. They are meeting a need - fintech are doing a great job - and they charge interest based on the risk they are taking. That is want you want with repeal of credit freeze.

Most of that FDI is  in what sector? Is it fintech and mobile gambling? Last yr tech attracted $350m https://www.businessdailyafrica.com/datahub/Kenya-nets-Sh35bn-in-tech-start-up-funding--outpaces-SA--Nigeria/3815418-5083844-11asclk/index.html but the bulk of it was in the shylock called fintechs. Such FDI and betting are just sucking out cash from poor kenyans.

Kenyans are having liquidity issues so the demand for this loans is huge. Basically this fintechs are raising capital to address the huge demand of mobile loans. The reason for that demand is liquidity issues and capping of interest rates. Its very clear the government has crowded out the private sector which has led kenyans to borrow from this shylocks.

[RV Pundit]

There are micro-loans that banks in their conventional model will never be able to lend.

[hk]

There are micro-loans that banks in their conventional model will never be able to lend.

The problem is the high interest rates. Banks have changed their business model. Kcb, equity and cooperatives are the dominant players in the mobile lending arena . If government stopped heavy borrowing locally and interest cap were scrapped, the need for fintech loans would reduce.  Or at the very least be forced to reduce interest rates by the market. BTW these micro-loans is what kenyans are borrowing and defaulting to the tune of over 500k black listed. What does that say about the state of the economy and status of consumer debt?

[RV Pundit]

Competition will reduce the interest - and of course lenders also need to be smarter - algorithm-wise on lending. They need to de-risk by refusing to lend to some people. They have to tighten the screws..otherwise we should not punish 10M responsible borrowers - because some 0.5M find themselves listed.The good think is they are gathering more and more behavioral data - making their predictive capacity more accurate - and hopefully in the future - excellent borrowers will get excellent rates - and doubtful borrowers will get high interest.

The problem is the high interest rates. Banks have changed their business model. Kcb, equity and cooperatives are the dominant players in the mobile lending arena . If government stopped heavy borrowing locally and interest cap were scrapped, the need for fintech loans would reduce.  Or at the very least be forced to reduce interest rates by the market. BTW these micro-loans is what kenyans are borrowing and defaulting to the tune of over 500k black listed. What does that say about the state of the economy and status of consumer debt?