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Telkom in push to have cross-network agent dealings

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Mugo Kibati
Telkom CEO Mugo Kibati. FILE PHOTO | NMG 

Telkom Kenya is pushing for implementation of agent and merchant interoperability to ease the process of cross-network transfers.

This year, telcos in Kenya implemented technical interoperability — where users are able to send and receive money directly from or into their accounts across the different networks, seen as the first step in levelling the playing field.

“Technical interoperability is just 10 per cent of what needs to be done to ease the process of cross network transfers. There is need for agent and merchant interoperability,” said Telkom Kenya Chief Executive Mugo Kibati in an interview with the Sunday Nation.

If implemented, agent and merchant interoperability would mean that customers for example, on T-Kash will be able to withdraw funds from Safaricom’s M-Pesa or Airtel Money agents and vice versa.

“We need to get to a threshold where agents make money from the float. If this is not doable, then the agents will not allocate float to other players beyond the dominant player,” said Mr Kibati.

Similarly, he stated that the merchant system should be integrated as is the case of the banking system. Despite having a smaller customer base in terms of card usage, customers are able to swipe their cards at pay points regardless of the bank running the merchant’s card reader (PDQ machine).

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The integration of wallets, merchants and agents is seen as a first step to evening the playing field that currently has Safaricom dominating the telephone, mobile money and mobile Internet subscriptions in the country.

According to Mr Kibati, the market dominance by a single operator in the telecommunications industry should be broken as recommended by advisory firm Analysys Mason to foster innovation in the industry.

“There is need to implement the dominance report. Customers suffer when the dominant player is so deeply entrenched,” said Mr Kibati.

The government pushed for the seamless cross-network transfers to help level the market and reduce Safaricom’s dominance, ICT Cabinet Secretary Joe Mucheru said when the service was launched.

This however has not been the case as data from the Communication Authority showed that the introduction of cross-network money transfers via mobile phones in April has failed to cut M-Pesa’s dominance.

The reduced cost and ease of receiving cash across networks has not eased M-Pesa’s grip of the money transfer market, which moved Sh2.03 trillion in the three months to September.

The Treasury in 2016 identified technological disaster in the M-Pesa-dominated mobile money sector as a potential fiscal risk for Kenya, saying a blackout on the platform could cost the government “substantial” losses in corporate tax revenue.

The worst case scenario has played out month after Safaricom was hit by an outage estimated to have cost the economy billions of shillings.

A similar outage hit the provider in July and April 2017 cutting off communication for users on the network, pilling pressure on the industry regulator to get a solution.

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World Bank pushes G-20 to extend debt relief to 2021

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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.

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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.

ALSO READ:Global Economy Plunges into Worst Recession – World Bank

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Kenya’s Central Bank Drafts New Laws to Regulate Non-Bank Digital Loans

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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.

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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.

SEE ALSO: Central Bank Unveils Measures to Tame Unregulated Digital Lenders

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Scope Markets Kenya customers to have instant access to global financial markets

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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.

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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.

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