18th March 2022 Trade & Financial Services Round Up

March 18, 2022 - 5 Minutes Read - By Kennedy Osore

Banks abandon CBK’s SME mobile loans deal 

Four lenders selected by the Central Bank of Kenya to give low-cost mobile loans to small businesses under a programme dubbed ‘Stawi’ have abandoned the deal.

The Business Daily can reveal that the platform has not issued a single loan for over a year after KCB Bank, Co-operative Bank, Diamond Trust Bank pulled out, leaving only NCBA on the programme.

The lenders have cited difficulties recovering the loans for their decision, with the small and medium enterprises (SMEs) defaulting on the unsecured mobile-based loans. KCB Bank CEO Joshua Oigara said the bank was issuing similar loans under the State-backed credit guarantee scheme.

While Stawi is still operational under NCBA with support staff and a website, the platform is not issuing new loans.

Stawi was meant to replicate the success of individual mobile loans at a business level, leveraging credit scoring based on data from M-Pesa and M-Shwari transactions and credit reference bureaus to enable banks to make instant lending decisions on MSMEs.

(Source: Business Daily)

Safaricom takes 99.9pc of mobile money market 

Safaricom has grown its control of the mobile money market to 99.9 percent amid efforts by regulators to open its M-Pesa platform to interface with those from rival Airtel Kenya and Telkom Kenya in a bid to enhance competition in the sector.

Data from the Central Bank of Kenya (CBK) shows that M-Pesa has grown its share of the value of mobile money transactions in the last three years to hit Sh2.206 trillion (99.9 percent) out of the total of Sh2.208 trillion worth of transactions in 2021.

M-Pesa’s growth has eaten into the market of Airtel Money and Telkom’s T-Kash in the period, with their shares dropping to 0.2 percent and 0.1 percent respectively.

Safaricom’s control of the market has prompted a push for regulatory changes initiated by its rivals who allege that the telco is abusing dominance.

The CBK, in a presentation to Parliament, said competition in the industry is being addressed through increased integration of the competing platforms. “Key initiatives to impact the payments sector include full-scale interoperability to build on existing collaboration and progress to national switch ‘pay anyone anywhere,” CBK says in the presentation.

Airtel and Telkom have petitioned Parliament on several occasions for the government to declare Safaricom the dominant player in the sector, paving way for regulatory changes intended to boost their dwindling fortunes.

(Source: Business Daily)


Tanzania, Kenya resolve 10 more trade hindrances

Tanzania and Kenya have resolved 10 more trade barriers in an effort to grow the trade between the two member states of the East African Community (EAC).

President Samia Suluhu Hassan visited Kenya last May and met her counterpart Uhuru Kenyatta to mend the then deteriorating bilateral ties.

The two leaders ordered ministers and other officials to meet and discuss the issues.

Through the follow-up meetings, some 56 issues were reported to have been resolved in 2021, prompting the growth of trade between the two countries by 38 percent to $765 million in the same year, according to a communique of the latest meeting.

Last week, the ministers and other government officials met for the follow-up meeting where 10 more issues were resolved while 14 outstanding issues are expected to be resolved by June this year, according to the communique of the meeting held from March 9-12.

The resolved issues presented by Tanzania include delay of clearance of goods due to scanning procedures; delays in issuance of import permits for dairy products; cumbersome procedures by the Kenya Revenue Authority; difficulties experienced by Taifa Gas Ltd in investing in Kenya; challenges in obtaining work for Tanzania professionals; and requirement of Covid-19 vaccination certificates for citizens of Tanzania to travel to Kenya by air.

The four issues presented by Kenya that were resolved include delayed response of codeshare by the Tanzania aeronautical authorities; denial of designation for Kenya’s Jambojet to operate passenger air services to Tanzania; restriction of free movement of engineers to Tanzania; and tour vans dropping tourists on the Tanzanian side of Namanga one-stop border post charged Sh5,000.

(Source: The Citizen)


IMF clears Uganda for UgShs455bn credit after “good performance”

The International Monetary Fund, IMF, has given Uganda a clean bill of health regarding the handling of the Covid-19 pandemic, the funds and the economy as a whole.

For this, the Fund’s board has allowed for the immediate release of 127 million US Dollars (about 455 billion Ugandan shillings) for the country as part of the Extended Credit Facility Arrangement. The latest disbursement brings the total under this arrangement to about UgShs1.38 trillion Shillings.

Under the Extended Credit Facility Arrangement, the approval of the next disbursement depends on how well the country utilised the previous one, in terms of allocating them to where they are due, completing reforms and other commitments agreed to, among others. Following a review of Uganda by the IMF staff that ended in December 2021, the government was found satisfactory in performance in most criteria.

The fund also aims at boosting more inclusive private sector-led long-term growth, targeting reforms focusing on prioritising social spending, sustaining debt, strengthening governance, and enhancing the monetary and financial sector frameworks.

(Source: The Monitor)


PM assures of food security, warns against price hikes

Prime Minister Edouard Ngirente has warned traders against exploiting consumers by unjustifiably increasing prices of locally grown foods such as sweet potatoes, tomatoes and cassava and using the (Russia-Ukraine) war as a pretext.

He was speaking on Wednesday, March 16, during a news conference that focused on the country’s economic recovery.

Overall, he said, prices of most foods grown locally did not increase, rather the costs rose for agricultural products that Rwanda largely imports including cooking oil and sugar.

The Premier observed that the current increase in prices of some foods produced in Rwanda are caused by speculation and the fact that it is not yet harvest time (for some produce such as Irish potatoes).

For the imported commodities, he said, the factors included some factories undergoing maintenance (which slowed down production), as well as the Covid-9 impact that increased the cost of trade.  

(Source: The New Times)


Addis inks $29m deals with China firms for public transport upgrade

Authorities in Ethiopia’s capital Addis Ababa have inked a deal worth $29.17 million with two Chinese companies to modernise the transport sector, the state-run Ethiopia Press Agency (EPA) reported Tuesday.

The first agreement valued at $15 million will enable the Addis Ababa city government to purchase 110 buses from China’s leading bus maker, Yutong, within eight months.

The city will also integrate digital systems in its public bus transport system among other upgrades at a cost of $14.17 million, according to details in the second agreement. The pact was signed between the Addis Ababa city administration and Chinese Hisense TransTech Co., Ltd.  

(Source: The East African)

Ethiopia Collects 221bn Birr Revenues in 8 Months 

The Ethiopian Ministry of Revenues announced that it has collected over 221 billion birr in revenues in eight months. The amount is 92.16 percent of the 240.34 billion birr target set for the period, the Ministry noted.

The revenue collected has shown a rise of 15.78 percent or 30.19 billion birr, Lake Ayalew, Ethiopia’s Minister of Revenues, pointed out.

Out of the 221 billion birr collected during the eight-month period, 131.12 billion birr has been secured from local tax, while 90.37 billion birr has been obtained from customs duties.

Mr. Lake once again thanked honest taxpayers who pay their taxes on time, as well the staff of the Ministry and customs offices at various levels, and all stakeholders and the general public for the achievement. He also called on all to continue to do their part to sustain the achievement in the coming months.

The Ministry of Revenues had collected 196.7 billion birr revenues in seven months, 24.3 billion birr being collected in the additional one month period.

(Source: 2merkato)


Ambassador Yohannes meets with South Sudanese Foreign Minister 

Eritrean Ambassador to the Republic of South Sudan, Mr. Yohannes Teklemicael, met and held talks with Mr. Mayiik Ayii Deng, Minister of Foreign Affairs of South Sudan, on strengthening bilateral ties as well as regional developments.

Indicating that the Eritrean Government has strong belief that the people of South Sudan have the capacity of addressing their problems, Ambassador Yohannes expressed Eritrea’s full support to the implementation of the peace agreement.

In their meeting, Ambassador Yohannes and Mr. Mayiik Ayii Deng discussed economic programs to the benefit of the people of the two countries.

The two officials also discussed the responsibility and rights of the Eritrean people residing in South Sudan in general and that of Eritrean investors in particular.

(Source: Ministry of Information Eritrea)


Fawry offers its electronic payment services to Sudanese customers 

Fawry for Banking and Payment Technology Services, Egypt’s leading provider of e-payments and digital finance solutions, announced today that it will begin providing Sudanese payments platform, Cashi, with its own digital transformation systems, ahead of the launch of its leading digital platform for classified ads and digital marketing Soug Sudan, (alsoug.com). The move comes as part of Fawry’s strategy to expand into new technological markets abroad and offering support for the popular digital platforms.

Soug al-Sudan, the biggest classified ads platform in the Sudanese market has recently announced the launch of its new payments platform Cashi, which will be followed by distributing Cashi Points of Sale (PoS), at vendors and merchants all over Sudan within the coming days.

Cashi points of sale will be supported by Fawry’s POS systems, which will allow small and medium sized merchants to offer a range of electronic payment services that include accepting cards and paying bills. Cashi will offer transparent, secure and easily tracked payment options, while also offering new income sources to store owners and small sized vendors.

The deal also is the first international capital investment in a technology company in Sudan since the country was removed from the sanctions lists.

(Source: Zawya)

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