Shylock business is a rip-off

Walking around Odeon Cinema in Nairobi, you can’t miss the signposts: Instant Loans on Items. Here, you submit an electrical appliance for a loan and then sign a contract. Breaching the contract means you lose the item and you cannot claim it once the repayment deadline has passed.

Shylocks, who are basically loan sharks, bank on the sanctity of a contract law that a borrower signs. These contracts are worded to act as a snare to the borrowers who usually misinterpret them. Most end up failing to meet the deadline and their items get auctioned.

The popularity of Shylock dens in Nairobi is usually fueled by lengthy and tiring procedures in obtaining loan from mainstream financial institutions.

From the horse’s mouth:

“I’ve been in Shylocking business for 5 years now and it’s thriving because people want instant cash and the prolonged bank processes make Kenyans avoid the financial institutions,” says Mr Makanyaga* who operates around Odeon Cinema in the capital Nairobi. “We give you cash against a product, preferably an electrical appliance. By looking at the item, I can tell the amount it will fetch in the market if one fails to comply with the contract.”

This acts as security, often for a shorter period typically seven days.

 “If you don’t repay the loan with the interest we can either negotiate you pay the interest first and I keep the item as you continue looking for money or I sell it,” adds Mr. Makanyaga*.

The risks:

Shylocking is not a bed of roses.

Sometimes the sharks have to deal with stolen items and this makes them prone to being sued in case they are caught. Besides, they may be given faulty or obsolete items and end up losing money since they cannot resell them.

While talking to Makanyaga*, a guy who looks drunk arrives and asks him for a Ksh500 loan. Taking his Samsung phone, Makanyaga* takes his contract note book and after scribbling something he counterchecks the phone and gives him the money. With a repayment period of seven days, the borrower is supposed to bring back Ksh650, a 30% interest. “That’s how we survive and we barely make losses,” he chuckles adding that he once gave someone Ksh50, 000 as a loan.

Eunny*, an accountant with a city-based company, is a frequent visitor to loan sharks’ dens. She says that when she has a pressing need, she turns to the Shylocks because they are the last option and getting money from them is easy. “Sometimes you find yourself in a fix; there is a pressing need and with a budgeted salary you have to turn to the Shylocks to meet this emergent need,” She volunteers to tell.

 “When you know there is a place you can get easy cash, you become addicted to it. Although the interest is high and the initiative makes people lazy, you are left with no choice.” Eunny*, like many urban dwellers, have resigned to this kind of rip-off.

Eunny was introduced to the Shylocking business in 2014 by her then workmate and she has created a rapport with the sharks since she is a regular borrower. “When you become a regular customer you create a mutual understanding with the lender and he may decide to scrap off some money when you don’t default; that way the loan burden becomes less.”

Because they are unregulated, Shylocks take advantage of gullible Kenyans and weave the contract in a way that sets the borrower to default so that they can sell the mortgaged item at a higher price than the loan. This is how they thrive.

Professional opinion;

The government should legalize shylocking in Kenya because the aim is to help a needy Kenyan at a fee. There is need to draft laws that can regulate the business so that they can start competing with the regulated financial institutions.

Only this way will there be sanity and benefit for the government. Otherwise, this is a rip-off to struggling entrepreneurs and businesses.

I can’t even talk about virtual money lenders like Tala, Branch, M-shwari and the like!

Making a case for youthful Agriculture

For a while now I’ve wondered about the future of agriculture in Kenya. It has been the Country’s predominant sector since the early days of independence, and even though a lot of activities are undertaken, the potential for growth still remains. Question is; are Kenyans willing to take up that charge? Or more specifically, are Kenya’s youth willing to do so?

One of the typical composition questions featured in English debates in primary schools when I was younger was: “The Farmer and the Doctor: Who Is More Important?” I always grappled with that question, but more often than not, it came down to the farmer. Why? Because basic human instinct seeks nourishment before other needs or wants. Maslow’s theory confirms this, and it’s also true in our everyday lives. 

Also, when you think about traditional African societies, medical practitioners (herbalists) relied on plants (grown by farmers) to treat their patients. So it would seem like the presence of the farmer with his food and plants for medicine gave birth to the doctor. In essence,

Either ways, I’m not here to argue about whether the doctor or the farmer is more important.

If my guess is right, thousands of school children are still contemplating that question in their essays. What I’d like to talk about though, is the youth’s perception of agriculture.

Thanks to globalization and western influence, many African youth look down upon careers in agriculture. Particularly with regards to farming and fishing! They think it’s beneath them. Let me correct myself. Since I’m also an African youth, we, as a collective, think it’s beneath us. This is really incredulous! How can an honorable trade such as farming, that essentially offers the opportunity of life and health, be a second-thought or second-class career option?

And it’s not just the youth who think this way. Adults do too. Many parents will say, “oh my daughter/son is going to grow up to be a medical doctor, lawyer, or teacher.” Very few say “my child will be a farmer or fisher when he/she grows.” Why is this the case? We seriously need to think about this. Especially since our main economic strengths lie in agriculture. If we ever want to advance into strong manufacturing and services sectors, we’re gonna need to fill up our breadbaskets to the brim and have extra in storage.

The agricultural sector needs us. Without the human resource base in that sector, we’re basically screwed. We’re letting our key strengths go to waste, and in addition to that, we’re paying a dear price for it by having to import food we can grow ourselves and dealing with food shortages and crises.

Food security is the essential ingredient to keeping humanity afloat. A hungry (wo)man is an angry (wo)man. And when Otieno, Kemboi, Wafula, Mumbua or Habib are angry, nobody else is happy. When you’re hungry, you’re not only irritable; you can’t concentrate until you get something in your system.

The great news is that in this era of technological advancement, there are many sexy agricultural jobs out there. Yep, you heard right. We need to change our idea about what agriculture entails because there are so many components to it. For instance, If you feel like you don’t have the muscles necessary to till the soil, you can concentrate on helping design and invent new technologies to make that process easier.

Not convinced yet? Okay. Let’s say you’re more interested in legal structures. You can do research and evaluate current labor laws governing the agricultural sector – both at the local and international levels (within the framework of the WTO for instance).

Figure yourself as more of a business person? No worries. You can help develop and implement marketing schemes to help farmers get as much profit as their hard work deserves.

Interested in climate change? You can help develop new, ‘green’ initiatives to keep the agricultural sector, well, green. And for those of us who think women are no good as farmers, think again. Women contribute the most to the subsistence agricultural sector in many African and developing nations.

At the end of the day, it all comes down to perception. If your window of perception about agriculture is limited to days under the sun toiling for hours on end, then you’ve got another thing coming to you.

We’re in a new era with new possibilities. And even if you do end up sweaty and panting under the tropical sun in a field of crop, is that so bad? You would be participating in one of the most honorable trades (in my opinion) out there, and you’d be contributing more than your quota to humanity. Think about it. It’s time to make agriculture sexy.

A country on its knees: A tale of Agriculture in Kenya

The Kenyan Government considers agriculture as the cornerstone for socio-economic prosperity. Agriculture is placed at the helm of all national development blue prints; vision 2030 and the Jubilee government manifesto among others. In fact a mega project like the Galana Kulalu irrigation project fortifies this!

With our state of economy, agriculture will for many years to come remain key to ensuring food and nutritional security for Kenyans, mostly small-scale farmers who draw a living from it. It is also a main propeller to our industrialization (as we await coal and oil exploration and exploitation in Lamu and Turkana) by virtue of being the principal wellspring of raw materials, thanks to the adoption of modern farming technologies. All these success stories about agriculture become more real only with favorable policy framework.

 Kenya, like many other countries, is faced with the challenge of increasing population and rising competition for agribusiness both in the regional and international arena. Meeting this would mean breeding a crop of young farmers who will in days to come fill the gaps left by ageing farmers considering that the average age of a Kenyan farmer is 65 years. Basically, agriculture is practiced by pensioners! A retrospective follow up of these “young farmers” depicts the policy injustice that the Government is doing to this golden sector.

 Related notification uncovers that the formal platforms, more so in the primary and secondary institutions, for the dissemination of farming techniques to the “hope of tomorrow” are either breaking down, inadequate or lacking trainers as a result of the emerging socio-economic challenges.

By nature, human beings will only pick what is perceived to be important. It may be a shock that agriculture education may no longer be a single entity subject in secondary schools, as it happened in primary school. This is imminent. There is a decline in the number of students taking agriculture in secondary schools, where it’s also an optional subject. Now is it really logical for a system to function without a spine?

 The negative discernment that agriculture does not compete equally in the job market could be one of the major reasons. The subject itself is downplayed by both parents and students, who by their gender and social upbringing opt for the ‘marketable subjects’. Agricultural programs in schools are stereotyped to be primarily for the males. How practical is it that a kid raised up in the city will pick up agriculture after school, which throughout their education has been an option? Their parents, who by default are the role models, do not practice agriculture.

 An ‘enterprising parent’ would rather use theirs plots available to establish a real estate rather than use it for agriculture. Those with interest lack the adequate exposure to the practical aspects of the subject, with teaching increasingly becoming superficial and exam oriented. Consequently, for a long time, there hasn’t been an effective way to integrate secondary agricultural education with most of the lucrative courses that are offered in the universities, which almost all the students are nowadays struggling to pursue.

As such, it would be more appropriate for guardians, educators, contrivers and policy makers to encourage agriculture education right from primary school.

 To develop self-dependence, problem-solving abilities and resourcefulness, learning agriculture will occupy students with activities that direct them to various agricultural ventures which may not exigently require high capital to head start, but significantly boost the economy. Agriculture can never flourish in isolation; increasing budgetary allocation for research may make it regain the lost glory.

I don’t think people in Europe got handouts in order for them to innovate and eliminate poverty. We would therefore greatly enhance this conversation by suggesting how we can create value in our people without paying them to be helped.

I have noted with gratitude that some of my readers make very constructive comments.  This form of crowd-sourced solution is what will lead to a sustainable solution, and I urge them to please let us continue thinking together.

Share this article to the corridors of power. All stakeholders and law-makers need to support agriculture - it is the only way out of poverty for the multitudes.

                               

Failed oversight: Senate and county assemblies to blame

After five years of experience with devolution, Kenyans have a perfect opportunity to review and improve upon the challenges that have bedeviled accountability in county governments.

Devolution is meant to promote democratic and accountable exercise of power, foster national unity, give powers of self-governance and ensure equitable sharing of resources.

It has potential to reduce the vicious competition we see in Kenya every electoral cycle over control of State House.

Every year for the last five years, Parliament has enthusiastically approved cumulative cash disbursements in excess of one trillion shillings to the 47 county governments. However accountability and oversight of these funds has been weak.

The role of oversight at the counties is shared between the Senate and County Assemblies. This shared role has been the source of much confusion which prompted the Council of Governors to seek a constitutional interpretation.

The High Court ruled that both bodies had a legitimate duty to carry out oversight, but cautioned that they should avoid concurrent investigations.

It would be difficult to enforce part of the ruling on concurrent investigations. Senate and County Assemblies operate at different levels of government hence there does not exist a conveyor belt requirement.

Furthermore, the Constitution in Article 229 (8) gives the two bodies only three months within which to complete their mandate. A failure of one body to conclude its investigations on time would result in a failure of the other to undertake its constitutional requirement.

It is expected that an adverse audit opinion should elicit sanctions on the part of the accounting officers at the counties. To give effect to its recommendations, Senate established an Implementation Committee to follow up resolutions of the House and ensure they are implemented by the respective organs.

However this approach has not been effective since it requires the intervention of other institutions with the mandate to investigate or prosecute.

At the county assemblies, members have been rendered impotent by a court order that declared section 40 (3) of the County Governments Act unconstitutional. They can no longer impeach members of the executive committee whose hands are caught in the cookie jar.

Another challenge to accountability is the hostility by governors to oversight institutions. In the last parliament, COG took Senate to court on several occasions to prevent their members from appearing before the public accounts committee.

The High Court ruled that governors as chief executive officers have a responsibility to respond to audit queries.

They further recognized the right of Senate to summon governors or any other witness, but cautioned that summons should be used as a tool of last resort and should be exercised without malice, caprice or arbitrariness.

The issues raised above are surmountable. Senate must provide clarity, through legislation and regulations, on the boundaries of the concurrent oversight role they share with county assemblies.

Parliament must give the Auditor- General financial and operational muscle to conduct quality audits within time.

Senate and County Assemblies must take a more proactive approach to oversight. 

Send your nonperforming MCA Home!

Guided by the failure of leadership in successive governments, the drafters of the Constitution saw it wise to have a clause in the Constitution that would allow recalling of elected leaders. Article 104 states that elected leaders, Senators and MPs can be recalled. 

Moreover, electorates can also recall a Member of County Assembly (MCA).

The process of recalling is the same for all and what differs is the threshold that needs to be reached due to population dynamics in the respective leadership areas. For instance, it will take less people to sign signatures for removing an MCA and most for removing a Senator.

In this article, I focus on MCAs

Disqualification by law; 
As stipulated in Article 193(2) of the Constitution, one is disqualified from being elected a member of county assembly if the person;

1. Is a state officer or other public officer, other than a member of county assembly
2. Has at any time within the 5 years immediately before the date of election, held office as a member of the Independent Electoral and Boundaries Commission. 
3. Has not been a citizen of Kenya for at least 10 years immediately preceding the dates of election. 
4. Is of unsound mind 
5. Is an undischarged bankrupt 
6. Is serving imprisonment sentence of at least 6 months 
7. Has been found, in accordance with any law, to have misused or abused a state office or public office or to have contravened chapter six (Article 193(2) of the Kenyan Constitution, 2010. 

Removal/ Recall of an MCA by law
The recall of a member of county assembly is done on the following grounds, if the member;

1. Is found, after due process of law, to have violated the provisions of chapter six of the constitution. 
2. Is found after due process of law to have mismanaged public resources. 
3. Is convicted of an offense under the Elections Act (No 24 of 2011). However, it is guarded by certain Conditions;

• It is only Initiated Upon a judgment of the High Court 
• It is only initiated 24 months after the Election and not twelve months preceding Election 
• It shall not be filed against a member more than once.
• A person who unsuccessfully contested in the election cannot initiate a petition under this section (Section 27(1) - (6) of The County Governments Act no 17 of 2012). 

Petition for Recall by voters under Article 104
A petition for recall shall be in wrtiing and filed with the Independent Electoral and Boundaries Commission (IEBC). It shall be signed by a petitioner who;
 Is a voter in the ward
 Was registered to vote in that election and
 Be accompanied by a High Court Order.
However, this was changed by a court order of July 17th 2017. Under these new regulations, any petitioner can file this kind of petition as long as you are registered to vote anywhere in Kenya.

The petition shall;
a) Specify the ground which the recall is sought.
b) Contain a list of such number of names of voters which represent 30% of registered voters in that ward. The list shall contain names, address , voters’ card numbers. The voters shall represent diversity of the people in the ward. The commission shall verify the list within a period of thirty days of the receipt.
c) Include a fee prescribed for the petition
The commission if satisfied by the verification and process, within 15 days shall notify the speaker.
The commission shall carry out the recall election within ninety days of publication of question (Section 29(1-7) of The County Governments Act no 7 of 2012)

Vacation of Office of MCA 
It is prescribed in the constitution (Article 194 (1) (a-g) of the Kenyan Constitution, 2010) that an office may be declared vacant;
a) If the member dies
b) The member is absent for eight sittings without giving satisfactory reasons to the speaker.
c) If the member is removed from office under article 80 of the constitution.
d) If the member resigns in wring addressed to the speaker
e) In case of political party the member resigns and for an independent candidate the member joins a political party.
f) At the end of term of the assembly or
g) If the member is disqualified from the elections on grounds specified in 193(2).

Send your nonperforming MCA Home!

We have formed a habit of complaining about our elected leaders. We hate and love them in equal measure. 

Every five years, at the peak of the campaigns, we forget so fast. We make the same old mistakes and elect bad leaders. Mostly, we recycle them. We then quickly start the grumbling circus for the next 5 years. 

Do you agree that majority of MCAs, MPs, Women reps, Senators and Governors are a major let down? Did we waste the whole day, in long queues to elect such persons?

Yes, I  do agree that most of these leaders have taken Kenyans for a ride.  And yes, I get so afraid that 2018 trumpets are quickly fading. And yes, Kenyans have not learned a lesson.  and YES the cycle will be repeated come 2022.

Indeed,  the voting machinery is at cross roads. Before 2022, you and I will be whirled with propaganda of hatred, ethnicity and intolerance. 

We shall be seduced to believe that our non performers were busy fighting for our interests. They earned heavy allowances, mortgages and car grants because of the burdens of representing us. 

Now, I am almost giving up. How  can I help citizens to stand out, have a say and stop the stinking spectacle of electing awful leaders. these malingerers!

This is Kenya. You may think it is impossible to change some old habits. You might feel so desperate. A used and manipulated  voter. You are not alone!

If you are a patriot, it is time to get out of the box and stamp your authority as the ultimate employer of the more than 2,400 elected leaders.  

It doesn't need to be so hard. You don't need to be a political broker. You don't need to be ethnically correct. You don't need to have loads of money. You don't have to be a sycophant. 

You just need to be crafty, innovative and take action. 

Here in lies your authority to ultimately fire your elected leader in 2018 and beyond. 

1. Ranking of leaders be supported

Let us support initiatives taken by pollsters to rank best performing Governors, Senators, MPs and MCAs. 

It is through such surveys that  Alfred Mutua was ranked as best Governor and Prof John Krop Lonyangapuo of West Pokot was highest ranked Senator in Kenya. Wilberforce Ottichilo of Emuhaya Constituency was ranked the best MP in Kenya. Gladys Wanga of Homabay County was ranked the best performing Womens representative. Vihiga MCAs were ranked the best. 

Thumbs up for Infotrak research & Consulting that developed The County-Trak Index. The main objective of the Index is to ascertain County residents’ assessment on the performance of their County Governments against set Key performance indicators and to develop a Citizens Scorecard on the performance of their County governments.

As a citizen you need to use such surveys to question credibility of your leader. 

2. Take you own initiative and ask what your leader is doing

Under the new constitution, several institutions such as the Auditor's General's office, Controller of Budget have data on performance of leaders, particularly governors. You should take the initiative and question some of the projects mentioned in these reports. 

This is where citizen organizing and participation become handy.   Form a loose youth, women or professional lobby group and seek answers from these leaders. It is important to get support of citizens and communities you represent. 

Leaders are made through such community voluntary contributions. You gain respect and recognition. 

Take the bull by the horns and sound the war drums.

Profile your elected leaders and share their manifestos. Yule anakaa malingerer, face them and demand productivity. 

should such a person not change to being more productive, Soon I will share with you how to approach the removal of a nonperforming elected leader! 

Kakamega County: Bringing the sexy back to Agriculture

Unfavorable weather conditions,cost of inputs and foreign exchange fluctuations are shocks common to the Kenyan agricultural sector. That stated, experts now contend that the stage is set for a new jolt: ‘the greying farmer’. Consider these variables: 

1: Agriculture  directly contributes 24% of Kenya's GDP and 27% of GDP indirectly through linkages with manufacturing, distribution and other service related sectors while 
2: The average age of the Kenyan farmer is 60 years old. Compare that to Brazil which shares a similar small scale holder profile has an average age of 42, while US where large scale farmers dominate, the average age is at 57 years old. 
3: On the contrary, Kenya is a youthful nation with approximately 78 percent of the population under the age of 35.  

Economics aside, it is clear there is an imbalance in these socio-economic variables that should be working together in a transformational growth equation.Based on the budget estimates released by The Treasury in June 2017, the Ministry of Agriculture, Livestock and Fisheries’ budgeted expenditure for 2017/2018 is approximately 23% of the national government budget. One would then question if the allocation is sufficient to propel the sector forward.  

That aside, of greater interest is the actual expenditure plan and how it will be geared to implement two action points in the Jubilee Government’s 5-point Action Plan ‘strengthening/modernizing agriculture and providing jobs for youth’. The two action points speak directly to the imbalance highlighted. So what is the plague behind agriculture’s low attractiveness index? Why do youth not envision their future as an agripreneurs? 

Access to land is a major constraint. Even with land leasing mechanism, some youth are excluded by land owners who prefer more experienced farmers. Land banks - designated land for agriculture with the government, the private sector or a public private partnership putting in place infrastructure, irrigation systems, auxillary and extension services, could be a solution. 

A road trip across the country cements the fact that Kenya has vast tracts of idle land.  Agri-research institutes can map out crop suitability at Ward level. Much closer home, the Governor of Kakamega County, Hon. Wycliffe Oparanya  recently welcomed agriculture investors to his county and promised "a friendly environment"; food for thought. 

There is no unequivocal evidence for or against the low returns issue. Kenya’s agriculture sector is currently a tale of mixed fortunes with cases of frustrated farmers uprooting crops in desperation while other ‘agri-preneurs’ enjoy high returns from their investments.

I strongly believe this disparity arises from lack of adoption of innovations and technologies as well as the lack of information. Our ancestors tilled the earth with ox ploughs and hoes. All valid methods, but we have moved to the 21st century of Play-stations. The need to practice controlled-environment agriculture should be everyday's preaching. Greenhouse farming is lucrative with good tidings; this also applies to open field sprinkler irrigation, drip irrigation and large scale farrow irrigation. 

Our farming techniques need to evolve to attract better returns and youth participation. Further, our farmers need information to encourage adoption, more so in the current changing environment. The vision of innovation, mechanization, and technology propagation needs to consider the reality on the ground and that is where the high capital variable comes into play. Taking into consideration that most Kenyan farmers are small scale holders, it may not make economic sense to invest in some of the mechanization technologies available.

Access to mechanisation and innovations is critical, young farmer or not. What avenues is the Government crafting to ensure access? Farm equipment pooling facilities may provide access and reduce the high capital demand. Historically, agriculture has been perceived as ‘hard and dirty’ work. 

In today’s world as highlighted by our very own Kakamega County Think Tanks' marketing quote, “image is not everything, it is the only thing”. Though an extreme statement, it captures the need to re-brand the sector’s image. 
Agriculture is more than toiling in the fields; with innovation, there are some awe inspiring farming technologies like hydroponics. 
Further, agriculture extends into agro-processing and agro-technology. After all, value addition and agro-enabling businesses are required to infuse innovation and higher revenues into the sector. 

We are not relegating our youth to primary production; we are coxing them to venture into the whole spectrum of the agri value chain. We hear of banking, business awards and the likes, where are the agriculture awards to motivate players into the sector; best agriculture innovation, best agri-business. 
Bring the pomp and funk into this space! In summary, we have 40 per cent of the population out of work (even higher among the youth). We are not yet food sufficient, relying on imports to cover the deficit. We have a population growing by close to a million people a year. 

Even as we diversify to cushion our vulnerable economy, we cannot afford to ignore this sector that has the potential to reduce poverty, youth unemployment and boost our economic growth. Youth are integral stakeholders, with innovative and risk-taking attributes they are best placed to act as transformative agents and reshape the sector.  

Dear national and Local government representative, as you draft your expenditure plans for the sector, consider how you can make agriculture appeal to generation X.