By Grace Mwende
When the president announced that over 4 million Kenyans will be removed from the CRB list, most Kenyans were impressed, but no one was thinking of the harm it would cause the small lenders in the country and more so the effect it has on debt collectors.
In his inauguration speech, Ruto had promised that his government would initiate reforms to the operation of CRBs in a move to give credit access to the over 14 million people listed.
Although the president promised that he had nothing against credit bureaus , to many financial lenders and debt collectors, this is a threat to their business because listing people on CRB is a way of instilling financial discipline which may not be the case going forward.
The CEO quest holding, one of the biggest debt collection companies in the country, Mr. Eric Oluoch said this decision by the president will demotivate people from paying their loans.
The role of debt collection companies is to collect past due debts from borrowers on behalf of credit lenders and earn a percentage of the debt collected.
Mr. Olouch, who is also the chairman the Association of Debt Recovery Agents (ADRA), expressed concern that the decision by the government to delist debtors will push away investors while the remaining ones will become more stringent which will mostly affect hustlers who depend on these loans to do their daily business.
“The government is supposed to create an enabling business environment but this move by the president is going to create a lot of harm,” said Mr Olouch.
Currently Kenya has over 30 debt collectors and this number has the potential of growing even more and creating more job opportunities. Mr.Olouch, notes that, during Corona when most companies where cutting of their employees his company alone employed over 350 people.
“Removing people from CRB is good and bad, good because some people were listed because of very little amount that they were not even aware of, the bad side is it will encourage people who borrow without the intentions of paying which may end up punishing investors,” added Oluoch.
Mr Olouch blames the culture of borrowers in the country for the ongoing tussle, He noted that most borrowers in Kenya borrow to spend without a plan of how to pay back the money, which makes it very difficult when it’s time to pay. According to Mr. Olouch you should never borrow to spend rather borrow to invest.
Through ADRA, the association has been trying to self regulate and create a professional look in an industry that has over the years been tainted by some rogue companies that threaten and shame borrowers.
“We are calling on the government to walk with us this journey, because we want to self regulate and create a professional industry were we can create more job opportunities,” he added.