Mobile phone based loans have extremely exorbitant interest rates and
are exploiting Kenyans. Unfortunately they are mushrooming everyday (now
more than 30!). Investors in such entities must also look at the
social and psychological impact of their investments on the low income
people and push for ethical business models. Many studies have shown
that this exploitative behaviors lead to high indebtedness among the
poor(often a cycle of a person borrowing to repay another loan before
eventually being completely unable to borrow) which leads to negative
long term effects including suicides, family breakups and increased
poverty. Parliament must also provide equal regulations for all credit
providers with consideration on impact on ordinary citizens.
