The Role Of Government In The Growth Of Fintech In Kenya

By Soko Directory Team / Published August 24, 2020 | 9:02 am



coronavirus

The Kenyan government through its regulatory bodies and parastatals has been at the forefront to promote Fintech in the country before and during the COVID-19 pandemic.

“We have seen this through different efforts and initiatives that have been deployed to increase financial inclusion,” says Cytonn Investments in their latest report.

The government of Kenya through the Ministry of Information, Communications, and Technology has established a task force to look into how the country can leverage on blockchain and IoT technology.

The government also partnered with Mastercard to develop a digital payment platform for government services on top of the existing providers such as M-PESA, Airtel Money among others.

Following the COVID-19 pandemic, the government through the CBK also instituted several measures to encourage the use of digital payments.

The withdrawal limit for mobile money transactions was pushed from 70,000 shillings to 150,000 shillings. CBK also directed that transaction costs for a bank to mobile transfer and mobile money transfers of 1,000 shillings and below be removed.

From a regulatory standpoint, CBK has tabled a bill, seeking to curb the steep digital lending rates that have plunged many borrowers into a debt trap as well as predatory lending.

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.

The banking sector and the telecoms sector have been leading in Fintech adoption, as evidenced by various banking digital apps and Safaricom’s M-PESA; however the investment and insurance sectors are lagging behind fintech adoption.

“Closer home, through our subsidiary, Cytonn Fintech, we have managed to successfully launch the Cytonn Wallet which is powered by Cytonn Money Market Fund (CMMF),” said Cytonn.

The digital wallet has enabled clients to invest, withdraw, and send money instantly to a bank or mobile money account, and still earn an attractive rate of return through our money market fund.

The provision of this all-inclusive financial ecosystem increases the efficiency in processing both payments and investments.




About Soko Directory Team

Soko Directory is a Financial and Markets digital portal that tracks brands, listed firms on the NSE, SMEs and trend setters in the markets eco-system.Find us on Facebook: facebook.com/SokoDirectory and on Twitter: twitter.com/SokoDirectory

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