Five institutions that could ruin your life

1.       Kenya Police Department

Being in good standing with the police is a no-brainer, as being on the wrong side of the law will land you in jail.

However, you usually need to prove to other people that you are indeed a law-abiding citizen, and the proof of that is having a certificate of good conduct. Getting one means that you do not have a criminal record with the Kenya Police.

SEE ALSO :MPs press Magoha over withheld certificate

This may be needed when:

-Obtaining a visa to some countries

-Applying for jobs in some multinational corporations. 

-According to the Kenya Police website, “The certificate of good conduct in Kenya shows that a job candidate is of good morals, behaviour and obeys the law.”

 -Applying for work permits in some countries

SEE ALSO :How lenders are using your calls, online posts to evaluate borrowings

-A government job

-Applying for a tender

-Renting some apartments

Had a case in court?

If you had a case in court but was acquitted by a court of law or appealed successfully, your criminal record is expunged from the criminal database. However, if you had been convicted, the record is kept for 20 years before it is expunged unless the crime was robbery, murder, treason, murder, rape and offences related to drugs.

SEE ALSO :Crisis as mobile lenders blacklist 2.5 million borrowers

You can apply for it one on at a fee of Sh1050.

2.       Credit Reference Bureaus (CRB)

If you have tried getting a loan in Kenya, you have probably had the lender tell you that they need to check your ‘CRB rating’. If you have a good score you will be able to access loans but if you do not, you cannot access loans. They get this rating from Credit Reference Bureaus which have been licenced by the Central Bank of Kenya to collect, manage and distribute credit information as required. The bureaus get this information from all money lenders. These bureaus are Metropol, Creditinfo and Credit Reference Bureau Africa (CRB Africa) also known as Transunion Africa.

 How the rating works

The rating shows how credit-worthy you are- if you have paid back loans that you owe on time. When the lender checks your rating, they look at your credit report, which contains all your credit history. With the proliferation of loan apps like Tala, Branch and mobile loans like Mshwari,  it is very easy to get yourself a bad rating, as even defaulting by a few shillings will get you blacklisted.

How long does blacklisting last?

If you have defaulted on paying back loans, you will be blacklisted for seven years and you cannot access any loans in that period.

Can you get off the blacklist sooner?

You can clear your name by:

1. Finding out from the bureau who submitted your name for blacklisting.

2. Clear your loans and get a clearance letter from them.

3. Email the letter to the CRB  to have it resolved.

 Can I find out my current credit rating?

If you want to get your credit rating, you can register with any of the three bureaus to get your credit report, and the law states that you are entitled to one free credit report every year. It does not matter which bureau you register with, the report is the same. Registering costs about Sh100.

3.       Kenya Revenue Authority (KRA)

Most Kenyans already know that there are penalties for not filing income taxes, but some people still do not do it when the June 30 deadline comes around every year. First, there is a Sh20,000 penalty for taxes filed after the deadline, in addition to an interest of one per cent of the tax due.  In addition, a new requirement has cropped up for many job seekers – a tax compliance certificate. It shows that you have paid all taxes necessary.

Not filing your taxes could lead to trouble when: 

1. You try to buy property 

2. You run for office

3. You import goods

4. You apply for a tender,

5. You look for a job

6. You try to emigrate

7. You are getting a job in some organisations

Why employers ask for a tax compliance certificate

This is increasingly being asked for by employers who do not want to inherit a tax burden.

It is also very easy to get into KRA’s bad books, and the penalties for that are high. For instance, if you have a business, just failing to keep proper records that help the government ascertain how much tax you owe attracts a penalty of between Sh10,000 to 200,000. For tax evasion, you will find yourself slapped with a fine of Sh400,000, or double the tax evaded (whichever is greater) or imprisonment for a maximum of three years.

4.       Higher Education Loans Board (HELB)

You are required to begin paying your HELB loan one year after you complete your university education, whether you are earning an income or not. After this, the amount you are required to pay begins increasing steeply, with a fine of Sh10,000 the first month you fail to pay and Sh5000 per month after that until you begin paying it back. 

Certificate needed by some employers

In addition, a HELB compliance certificate (given at Sh 1,000) is required by many potential employers nowadays, even if you did not get a loan from HELB.

What is the risk of not paying back your loan? 

-Your children will not access the loan facility in future

- HELB has debt collectors to track loan defaulters living abroad

-In some government institutions, lack of compliance will deny you promotion

-Blacklisting by credit reference bureaus, meaning you cannot borrow money from other lenders

5.       Directorate of immigration and registration of persons

If you talk to the homeless on the street, they may not have much, but what they always have on them is their identification card (ID). The reason? It is an offense to not have one if you are over 18 years of age.  Under section 6 of the Registration of Persons Act Cap 107, every Kenyan citizen above 18 years must be registered and issued with an ID. You are required to present yourself before a registration officer within 90 days of turning 18. If you attain 18 years while outside Kenya, you must present yourself for registration within 30 days of getting back into the country.

- You cannot vote

- You cannot transact at the bank and unless the attendant at the mobile money transfer shop gives you an exception, you cannot withdraw cash.

- If a single detail on your identity card is different from what is on the birth certificate, you have to acquire an entirely new identity card before you can apply for the passport.

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CRBHelbKenya Police Department