Revisiting Regulatory Models of Banking Sector in Kenya: From Njuguna’s Restraint to Njoroge’s Missiles

Former CBK governor Njuguga Ndung'u exercised regulatory restraint in regulating the banking sector and payment systems. This hands off approach led to growth of Fintech in the country making Kenya to be among the leaders. But it also led to accumulation of risk and unsafe banking practices. Governor Njoroge has taken a prescriptive regulatory approach, … Continue reading Revisiting Regulatory Models of Banking Sector in Kenya: From Njuguna’s Restraint to Njoroge’s Missiles

Kenya Public Pension Scheme Require Overhaul

In Kenya, pension expense take a huge percentage of public expenditures. Yet, the government is making payments to people who are able bodied, but not contributing to public coffers. Such regime of social security is outdated. Public pension schemes require immediate overhaul It is the German Chancellor Otto von Bismarck who introduced the world’s first … Continue reading Kenya Public Pension Scheme Require Overhaul

End of Dollar Dominance and Its Malcontents

Dollar dominance may have reached its end. Evidence portray a trend of massive de-dollarisation by world economies. It is time emerging economies such as Kenya adjusted accordingly. A random invoice will demand that payment to be made through SWIFT. This is an international payment system by the Society for Worldwide Inter-bank Financial Telecommunication (SWIFT), which … Continue reading End of Dollar Dominance and Its Malcontents

Why the Proposed Privatizations is Glory to the Capital Markets

By g.j The Privitisation Commission has approved the offloading by equity stake in 26 state owned entities, some which be sold of through initial public hearings. This is good news. Privatization often brings into the market new industries, which increases investor’s diversification opportunities, and improves market liquidity. In case where privatization is by cross-listing of … Continue reading Why the Proposed Privatizations is Glory to the Capital Markets

How to Ensure Kenya’s Unique ID Project Succeeds

Kenya's identity ecosystem is messy. There is very little linkage between foundational identities and functional identities. This has led to duplication of registrations and proliferation of cards, to a huge cost. The country is planning to issue a single unique identifier (NIIMS), a Kenyan version of Aadhaar.  It would have been preferable if the country … Continue reading How to Ensure Kenya’s Unique ID Project Succeeds

The Death and Resurrection of Customary Trusts in Land

"Aye Africa Eh, eh Africa Oh Li panda: Aye Africa Eh, eh Africa Oh Liberté".  In Africa, land was held by community, by tribe or by family. Some of it was reserved for common uses: ceremonials and rituals. Then, there came land adjudications. Individuals become registered as proprietors of this communal land. Instead of being … Continue reading The Death and Resurrection of Customary Trusts in Land

Finance Act: Why Presumptive Tax will Fail and Other News

By gatuyu t.j Presumptive Tax: The Finance Act has scrapped the turnover tax and replaced it with the presumptive tax. The scrapped turnover tax, introduced in the year 2008, was charged on persons who did not meet the VAT threshold to register for Value Added Tax (turnover of below KES 5Million). However, it was optional, … Continue reading Finance Act: Why Presumptive Tax will Fail and Other News

The Death of Dividend Tax Account and Resurgence of Compensating tax

Review of the Finance Act 2018 The Dividend tax account, loathed by accountants and detested by revenue officers, has been scrapped. The Finance Act 2018 has repealed and replaced section 7A of the Income Tax Act which required resident companies that pay dividends to maintain a dividend tax account. Section 7A was unnecessarily prescriptive. It … Continue reading The Death of Dividend Tax Account and Resurgence of Compensating tax