NAIROBI (Xinhua) --
Kenyan President Uhuru Kenyatta has launched the
Kenya Mortgage Refinance Company (KMRC), a financial institution
whose sole function is to provide long-term loans to primary
KMRC, which starts operations with an
initial capital base of 35 billion shillings (about 350 million
U.S. dollars), is expected to address inherent financing
challenges and unlock liquidity for affordable housing.
Kenyatta said KMRC will provide long-term loans to mortgage
lenders in order to increase the availability and affordability
of mortgage facilities in the country.
"The intervention is based on recognition that reaching the
goal of adequate, safe and affordable housing for all,
especially the lower income group, requires a fundamental
rethinking of the traditional approach used in the past,"
Kenyatta said during the launch in Nairobi.
He said the move to provide long-term cheaper funding to
primary mortgage providers including banks, microfinance banks
and Saccos (financial and nonfinancial cooperatives) is aimed at
making mortgage cheaper for Kenyans.
Kenyatta said the initiative is a partnership between the
government and the private sector, noting that the initiative
demonstrates the possibilities of the growing synergy between
the private sector and the government towards the delivery of
He said the new venture is aimed at addressing the deficit in
housing created by the huge rise in the country’s population as
well as boosting the government’s job creation initiatives.
"As we continue to experience the dividends of our growing
population, the housing supply has, over the years, not kept
pace with the concurrent growth in the demand for houses.
"As a result, this has led to a huge housing deficit,
particularly for the lower income households," he said.
KMRC was incorporated as a non-deposit taking financial
institution under the supervision of the Central Bank of Kenya.
The initial loans to kickstart KMRC were provided by the
World Bank which contributed 250 million dollars, and African
Development Bank which contributed 100 million dollars.
Kenyatta said the government is making deliberate
interventions in the housing sector to make it more responsive
to middle and lower income segments of the population.
He said the uptake of housing mortgages in Kenya remains
below its potential with the Central Bank of Kenya statistics
showing that the total outstanding mortgage debt in 2017 stood
at about 2.23 billion dollars.
This, Kenyatta said, represents only about 2.74 percent of
Kenya’s GDP, which shows that the housing mortgage business in
Kenya is still very small.
"We expect the refinance company to significantly contribute
to the development of the housing finance market in Kenya and
help reverse the low mortgage penetration, by increasing the
number of mortgages from the current 26,000 to over 60,000 by
the year 2022," he said.
Kenyan lenders leverage on
digital customer data to offer credit
NAIROBI (Xinhua) --
Businessman Gilbert Wandera is currently building
a house in his rural home in Busia, western Kenya.
Working in Nairobi, Kenya’s capital, Wandera relies heavily
on mobile money to pay his workers and buy construction
materials, work that has been going on for the past four months.
Last week, the businessman was in a fix after running short
After trying several commercial banks, the maximum loan they
could offer him via their digital apps was 40,000 Kenyan
shillings (400 U.S. dollars), but he needed more.
He turned to leading telecom Safaricom, which runs a digital
credit platform, and was offered 750 dollars that he needed via
his mobile phone.
Apparently, the telecom used his mobile money data to assess
his credit worthiness and offered him the money.
"Being a businessman, I do most of my transactions via mobile
"Unlike the banks, the telecom has all the data on my
transactions and I believe it is the reason why they gave me the
money," he said on Wednesday.
In the past, Wandera would have had to walk into a bank and
apply for the loan and surrender a title deed or car log book to
get the money.
But all that is now in the past as banks and other lenders
turn to digital customer data to extend credit to Kenyans.
The data include bank account and mobile money transactions
and airtime top-ups.
The new method is revolutionizing Kenya’s credit sector, with
millions of Kenyans who initially would never have borrowed
money from banks accessing credit.
The money, which ranges from 5 dollars to 3,000 dollars, is
mainly disbursed via the mobile phone.
The use of the data has now put Kenyan banks on the path to
disbursing all their loans, big or small, via mobile phone.
With some 46 million Kenyans owning mobile phones and 30
million subscribed to mobile money, according to the latest data
from the Communications Authority of Kenya, lenders are easily
collecting customer data that inform decisions when offering
The data has given Kenyan lenders confidence to offer
businesses and individuals huge sums of money via the mobile
On Monday, five Kenyan banks launched a digital credit
facility that will see small-and-medium-sized businesses borrow
up to 2,500 dollars via mobile phone, thanks to use of data.
It is a first in a country where over 90 percent of loans are
currently being disbursed via the phone.
During the launch of the digital credit product by the banks,
Central Bank of Kenya governor Patrick Njoroge termed the
growing use of digital customer data to disburse loans in the
east African nation as revolutionary.
"Lending has been constrained by the lack of reliable
information to assess their creditworthiness.
The innovation in this product is the use of all data on
customers’ transactions to fill this gap.
In that sense it is revolutionary," he said.
Analysts noted that use of digital data will radically change
the lending sector in Kenya, with banks being forced by the
customers’ needs to adopt this method.
"An increase in lending through digital platforms, especially
by independent lenders, pointed to the direction the industry
was headed, making banks which initially were rigid to conform,"
said Bernard Mwaso of Edell IT Solution in Nairobi.
Mwaso noted that globally, data is being used to drive
business, therefore, the Kenyan banking industry is no
"Huge data is collected on mobile money platforms each minute
which can be used to analyze peoples’ income, remittances and
even the state of the economy.
"This data has a big economic value, it is the reason banks
and other lenders are leveraging on it," he said.
Kenya launches bid to host
African Continental Free Trade Area secretariat
NAIROBI (Xinhua) --
Kenya on Thursday launched a bid to host the
African Continental Free Trade Area (AfCFTA) secretariat.
Macharia Kamau, principal secretary in the Ministry of
Foreign Affairs, told journalists in Nairobi that Kenya’s
Africa-centric foreign policy is focused on delivering the
promise of continental growth development and security through
the Agenda 2063.
"Having the secretariat come to Kenya would not only cement
Kenya’s role as a lead country in trade and multilateralism, but
it would also avail Africa the best venue and the best
opportunity to grow free trade and secretariat to its full
potential not only for Kenya but for the benefit of all
Africans," Kamau said.
Other countries that have expressed interest in hosting the
secretariat include Ghana, Egypt, Senegal, Eswatini and
The AfCFTA aims to create a single continental market for
goods and services, with free movement of persons and
investments, and thus paves the way for accelerating the
establishment of the continental customs union, common market
and monetary union.
Kamau said that Kenya has always been at the forefront in
championing the African economic integration as well as the free
movement of goods, people and services across the continent for
the last 40 years.
International Trade Center
urges Kenya to empower women to achieve goals
NAIROBI (Xinhua) --
The International Trade Center (ITC), a
development agency under the World Trade Organization and the
United Nations, on Wednesday urged Kenya to empower women in
order to accelerate the achievement of Sustainable Development
Simon Balfe, ITC program officer for sustainable and
inclusive value chains told Xinhua in Nairobi that due to a
myriad of challenges, women are underrepresented in most
"When women prosper, they spend more on health, nutrition and
education, accelerating the achievement of the SDGs," Balfe said
during the private-sector meeting and business-to-business
session organized by the ITC’s SheTrades in the Commonwealth
The initiative aims to increase economic growth and job
creation in Commonwealth countries by enabling the increased
participation of women-owned businesses in international trade.
Balfe said that one way to enhance women empowerment is
through integrating gender awareness and consideration of gender
into trade policies and agreements in order to proactively
include women and women-owned businesses in the global market.
He revealed that typically women have less access to
information on how to navigate the government regulatory
According to ITC, businesses that export also tend to employ
more women in their workforce and therefore should be encouraged
by the state.