The Kenya Pipeline Company (KPC) management was at pains to explain how an insurance company was offered a lucrative insurance deal when it had not taken part in the tendering process.
KPC’s acting Managing Director Hudson Andambi said he could not confirm if Africa Merchant Assurance Company (Amaco) was legally engaged. He revealed Amaco was introduced as a co-insurer a month after the tender for the company’s overall insurance was awarded to Co-operative Insurance Company (CIC).
The hiring of Amaco was conducted during the tenure of the former Managing Director Joe Sang who, together with other former senior managers, have since been charged in court.
Mr Andambi, who was appearing before the Senate Energy Committee alongside Petroleum and Mining Cabinet Secretary John Munyes, said he would have to look at the advertisement that called for tenders afresh and the regulations guiding the insurance policy to know if it was legal to engage a co-insurer without going through the tender process.
He told the committee that CIC, which had won the tender for the policy on Industrial All Risk and that of Terrorism and Sabotage, could have realised the risks involved in insuring KPC were very high and sought to co-opt Amaco to spread the risk.
These policies cover losses and destruction of all operations and installations of KPC, including pipeline, terminals, pump stations, storage tanks and other ancillary facilities.
“I don’t know if what was done was legal or not. I may first need to look into the entire process from the point at which we placed the advert. What I can confirm is that Amaco was introduced in September while the award was given in August. It was after the award was given but before the contract was signed,” said Andambi.
Munyes said the procedure of picking the insurer was followed until the point at which Amaco came into the picture. He was however non-committal on the legality of otherwise of the deal.
According to the insurance deal, CIC was to cover 70 per cent while 30 per cent of the cover was to be undertaken by Amaco. The cover was to run from July 1, 2016 to June 30, 2019.
Committee Chairman Nyeri Senator Ephraim Maina directed KPC to relook at how Amaco was engaged and furnish the committee with information on whether the process was lawful.
“We appreciate the fact that no single company can handle the kind of risks involved as this is very huge risk but we want you to go back and check the process and tell us if what was done was lawful,” said Maina.
Other senators who questioned the legality of the process were Ledama ole Kina (Narok), Mithika Linturi (Meru) and Ochillo Ayacko (Migori).
KPC also revealed that CIC declined to pay them a Sh1 billion claim over the controversial spillage of oil, allegedly due to adverse media reports.
Instead, Andambi said the insurer only offered them Sh100 million as ex-gratia payment for the loss.
Maina questioned why the company has not hired the services of an adjuster to help them get more from the insurance company and avoid passing the burden to consumers.
World Bank pushes G-20 to extend debt relief to 2021
World Bank Group President David Malpass has urged the Group of 20 rich countries to extend the time frame of the Debt Service Suspension Initiative(DSSI) through the end of 2021, calling it one of the key factors in strengthening global recovery.
“I urge you to extend the time frame of the DSSI through the end of 2021 and commit to giving the initiative as broad a scope as possible,” said Malpass.
He made these remarks at last week’s virtual G20 Finance Ministers and Central Bank Governors Meeting.
The World Bank Chief said the COVID-19 pandemic has triggered the deepest global recession in decades and what may turn out to be one of the most unequal in terms of impact.
People in developing countries are particularly hard hit by capital outflows, declines in remittances, the collapse of informal labor markets, and social safety nets that are much less robust than in the advanced economies.
For the poorest countries, poverty is rising rapidly, median incomes are falling and growth is deeply negative.
Debt burdens, already unsustainable for many countries, are rising to crisis levels.
“The situation in developing countries is increasingly desperate. Time is short. We need to take action quickly on debt suspension, debt reduction, debt resolution mechanisms and debt transparency,” said Malpass.
Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans
The Central Bank of Kenya (CBK) will regulate interest rates charged on mobile loans by digital lending platforms if amendments on the Central bank of Kenya Act pass to law. The amendments will require digital lenders to seek approval from CBK before launching new products or changing interest rates on loans among other charges, just like commercial banks.
“The principal objective of this bill is to amend the Central bank of Kenya Act to regulate the conduct of providers of digital financial products and services,” reads a notice on the bill. “CBK will have an obligation of ensuring that there is fair and non-discriminatory marketplace access to credit.”
According to Business Daily, the legislation will also enable the Central Bank to monitor non-performing loans, capping the limit at not twice the amount of the defaulted loan while protecting consumers from predatory lending by digital loan platforms.
Tighter Reins on Platforms for Mobile Loans
The legislation will boost efforts to protect customers, building upon a previous gazette notice that blocked lenders from blacklisting non-performing loans below Ksh 1000. The CBK also withdrew submissions of unregulated mobile loan platforms into Credit Reference Bureau. The withdrawal came after complaints of misuse over data in the Credit Information Sharing (CIS) System available for lenders.
Last year, Kenya had over 49 platforms providing mobile loans, taking advantage of regulation gaps to charge obscene rates as high as 150% a year. While most platforms allow borrowers to prepay within a month, creditors still pay the full amount plus interest.
Amendments in the CBK Act will help shield consumers from high-interest rates as well as offer transparency on terms of digital loans.
Scope Markets Kenya customers to have instant access to global financial markets
NAIROBI, Kenya, Jul 20 – Clients trading through the Scope Markets Kenya trading platform will get instant access to global financial markets and wider investment options.
This follows the launch of a new Scope Markets app, available on both the Google PlayStore and IOS Apple Store.
The Scope Markets app offers clients over 500 investment opportunities across global financial markets.
The Scope Markets app has a brand new user interface that is very user friendly, following feedback from customers.
The application offers real-time quotes; newsfeeds; research facilities, and a chat feature which enables a customer to make direct contact with the Customer Service Team during trading days (Monday to Friday).
The platform also offers an enhanced client interface including catering for those who trade at night.
The client will get instant access to several asset classes in the global financial markets including; Single Stocks CFDs (US, UK, EU) such as Facebook, Amazon, Apple, Netflix and Google, BP, Carrefour; Indices (Nasdaq, FTSE UK), Metals (Gold, Silver); Currencies (60+ Pairs), Commodities (Oil, Natural Gas).
The launch is part of Scope Markets Kenya strategy of enriching the customer experience while offering clients access to global trading opportunities.
Scope Markets Kenya CEO, Kevin Ng’ang’a observed, “the Sope Markets app is very easy to use especially when executing trades. Customers are at the heart of everything we do. We designed the Scope Markets app with the customer experience in mind as we seek to respond to feedback from our customers.”
He added that enhancing the client experience builds upon the robust trading platform, Meta Trader 5, unveiled in 2019, enabling Scope Markets Kenya to broaden the asset classes available on the trading platform.