OKash addresses claims of mistreating customers
Okash Mobile money lending app has addressed allegations by the Digital Lenders Association of Kenya (DLAK) of mistreating defaulters after they were named and shamed for alleged rogue practices.
The management of OKash said they were aware of the letter that was published by DLAK on Tuesday but added that the letter shows a series of false and misleading accusations based on social media reports as opposed to factual knowledge about their debt collection process.
“The OKash terms and conditions clearly state that when a user initially registers in the OKash app, they provide the service with contact information from their reference number or referee which is contacted only in case the original borrower becomes unreachable,” part of their statement read.
— OKash (@OKash_Kenya) June 8, 2020
DLAK had blasted OKash saying the practice goes against data protection laws in Kenya.
“Not only does this behaviour go against Kenyan data protection laws, but it reeks of indignity. By reaching out to a customer’s contact list, Opesa and OKash rob the individual of basic dignity and consumer rights. This can have long term effects on their psychological well-being and damage relations that may have taken years to build” said DLAK Chairman Robert Masinde.
CBK pursues regulation
The digital lenders association’s criticism comes even as the Central Bank of Kenya (CBK) pursues regulation of the sector.
The digital lenders have come under fire for slapping users with high fees and interest rates on loans and the deployment of overreaching policies to recover the debt.
Back in 2018, OKash, which is owned by Opera Group, came under fire for texting and calling the contacts of customers who default loan repayment.
After complaints were raised by defaulters, and some of the complaints published by Nairobi News back in 2018, the company responded saying they operate under a standard procedure for debt collection.
“OKash operates under a standard procedure for debt collection similar to other financial services in Kenya. As a new service, we are still in the process of testing various methods for collecting bad debt, and we will evaluate the current practice in reference,” Opera communication manager Alejandro Viquez told Nairobi News back in 2018.
The operations of digital money lending institutions in the country have been under scrutiny as the number of Kenyans listed with credit reference bureaus (CRB) has hit 3.2 million, a jump from the 2.7 million in just one year.
In March, President Uhuru Kenyatta directed that Kenyans who failed to pay their loans from April 1 should not be listed with the CRB. The government has also ordered the delisting of any borrower who may have defaulted on less than Sh1,000.