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CBK boss calls for price regulations to protect consumers

The Governor of the Central Bank of Kenya Patrick Njoroge [Courtesy]

Central Bank of Kenya Governor Patrick Njoroge has called for the regulation of prices for services offered through online platforms to avoid consumer exploitation.

“At the beginning, we didn’t have the sense of how to price online services but now we have a clear path on how we are going to be pricing the services. We have spoken to the payment service providers and explained to them they can’t charge whatever they want,” said Njoroge.

Dr Njoroge was speaking in Mombasa during the World Consumer Rights Day on Tuesday. He said CBK and other regulators will evaluate whether online services are cost effective for the customer.

The governor expressed optimism that prices "will come down with time because there are more opportunities and alternatives for customers."

"There are more players in the market... at least three players operating in the digital finance space. I think customers will benefit going forward not only on services but the choice provided to them,” said Dr Njoroge.

The governor, however, said that CBK does not support cryptocurrency investments due to their inherent risks.

Dr Njoroge said the financial regulator was working closely with other regulatory bodies around the world to ensure the space is safe for the population to invest in.

He revealed that for every person who wins in cryptocurrency, 100 lose their investment. “A few years back we issued a warning to all Kenyans and those beyond our borders that there was significant risk in cryptocurrency not only because it was unregulated but it was supporting illegal transactions,” he said.

Dr Njoroge said the CBK will only support the cryptocurrency business once additional measures are put in place to protect the population.

Communications Authority of Kenya Director General Ezra Chiloba said that mobile money services had registered 34.5 million subscribers as of September last year.

Mr Chiloba said that during the same period, the value of transfers from person to person was over Sh1 trillion while a similar amount was deposited into mobile wallets. "This is particularly so because digital finance continues to play a critical role in enhancing financial inclusion in the country."

Mr Chiloba, however, warned that consumers are increasingly exposed to scams, fraud, and other data malpractices."