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{
    "id": 959686,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/959686/?format=api",
    "text_counter": 90,
    "type": "speech",
    "speaker_name": "Kiambu, JP",
    "speaker_title": "Hon. Jude Njomo",
    "speaker": {
        "id": 1784,
        "legal_name": "Jude L. Kangethe Njomo",
        "slug": "jude-l-kangethe-njomo"
    },
    "content": "banks have become the best advocates of wananchi . They are saying that wananchi are being affected. The banks promised us when we passed this law that they were going to cause a credit squeeze and they are not going to provide credit to our SMEs and the wananchi . That is exactly what they are doing. They are withholding credit from mwananchi, so that they affect our economy. When they affect our economy, they then arm twist our Government into changing this law so that they can go back to the field which they are used to and charge whatever interest rate they want. That will be the wrong direction to take. We should stand firm. We should let the banks know that this is a country that is regulated by laws. They should obey the law. Why should the interest rate in Kenya be at 18, 20 or 28 per cent and in other countries it is as low as 3 per cent? Where did we go wrong? Why should we be charged such high interest rates? When you are borrowing money and you are charged, say, 28 per cent, when will you ever make money as a business person? I understand most businesses make about 30 per cent as their profit. So, if you are paying between 20 per cent and 28 per cent to the bank as interest, then you have no business. We have been working for banks! Business people have been working for banks and that is why everybody is complaining that there is no money in the economy. People are not making profit. All the little profit they make goes to banks. So, as we move on, we should always remember that we are doing this for our country. We want to enable our people to conduct their businesses in a profitable manner. Another reaction from the banks after this law was passed is that new mobile applications have been mushrooming. They are now giving loans to our people at between 5 per cent and 10 per cent per month amounting to almost 100 per cent. We have read here that this law is about any bank or financial institution. If you go to the same Act, a financial institution has been defined as any institution that takes money from wananchi either for keeping or for enterprising to make interest or to pay interest. These microfinance institutions are financial institutions, but the CBK has been unwilling to regulate them. If we could regulate the microfinance institutions and even the co-operative movement, then our interest rates would remain as low as required. The mushrooming mobile applications are charging excessive interest rates. I think time has come for this House to think of how to regulate those mobile applications. They are messing up the lives of our youth because students in high schools and universities who have access to mobile phones are borrowing the money and are unable to repay. Their names are taken to the Credit Reference Bureau (CRB). After graduation - when they are looking for employment - they are asked for a certificate from the CRB, which they cannot get because they owe mobile applications some money. We need to work on the mobile phone borrowing so that we can save our people. With those few remarks, I wish to move this Bill. I would like to request the Leader of the Minority Party to second it."
}