Category: Business Daily

Kenya is grappling with a retirement savings challenge. It is estimated that more than 70 per cent of workers retire without formal pension.

This leaves many dependent on modest National Social Security Fund (NSSF) benefits, family support or savings, which often prove insufficient.

The challenge is becoming more urgent as Kenyans live longer, while rapid urbanisation and changing traditions erode the safety net of the extended family.

Policymakers are under pressure to strengthen retirement security, with NSSF pushing for legal changes that would allow members to access some of their savings before retirement.

However, this would only benefit the relatively small number of workers who have built up pension savings over decades of employment. There are also concerns about whether they receive every shilling they are entitled to.

Experts say many retirees begin to scrutinise their benefit statements after receiving the final payout quotation. It is then that they discover errors such as missing contributions, inaccurate records and mistakes in benefit calculations.

Mr Albanus Muthoka, the Assistant General Manager of Operations at Enwealth Financial Services, says one needs to know how pension benefits are calculated.

“In Defined Benefits (DB), payout is determined by the member’s pensionable service in the scheme, the applicable actuarial factor as provided in the scheme’s trust deed and rules, or the hybrid comparison of the actuarial cash equivalent and the accrued contributions,” he says.

Members joining such plans should access records from the start of their employment to understand what they are entitled to. Most DB schemes have closed to new entrants.

Mr Muthoka says in the Defined Contributions (DC) scheme, payout is based on the total contributions made by the member and employer, plus any additional voluntary contributions and the accrued interest over the contribution years.

Contribution structures may differ from scheme to scheme, so it is important for new workers to familiarise themselves with documents.

“Members should be aware of the type of scheme, whether a Provident Fund (which provides a full pension upon retirement) or a Pension Scheme (which provides partial access, mostly up to a one-third lumpsum, with the balance used to secure a monthly pension, also known as an annuity).”

Experts say retirees should resist the temptation to accept the first benefit computation presented to them without reviewing the supporting documents, even after years of contributions.

According to Mr Muthoka, retirees should familiarise themselves with their scheme trust deed and rules, as these outline their benefits, eligibility conditions and how retirement benefits are determined.

He advises members to request and review their final benefit statements to confirm that their membership details, service period, contributions and other benefit records are accurate and up to date.

“In addition, retirees should obtain a benefit computation worksheet, which clearly explains how the final retirement benefit has been calculated, including any tax deductions or other adjustments made before payment,” he says.

Errors in pension processing are not uncommon. One frequent mistake involves incorrect benefit calculations arising from inaccurate salary records and pensionable service, particularly in DB schemes.

Other errors are incorrect tax calculations resulting from inaccurate member biodata, such as incorrect scheme joining dates or the wrong allocation of benefit balances for tax purposes.

Mr Muthoka highlights inaccurate member account balances caused by the incorrect posting of contributions, uncredited contributions or transfers that have not been allocated to individual accounts, particularly under DC schemes.

“Members should monitor their retirement savings regularly through online portals or mobile apps provided by their scheme administrators. They should compare the contributions reflected in their pension records with those shown on their monthly payslips to ensure correct amounts have been remitted,” he says.

The Retirement Benefits Authority (RBA) says delayed or missing employer contributions are one of the biggest causes of disputes.

RBA Chief Executive Charles Macharia says the most common complaints are about delayed remittance of pension contributions by employers.

“In some cases, deductions may have been made from employees’ salaries but not remitted to the retirement scheme within the prescribed timeframe,” he says.

Mr Macharia adds that disputes also arise from errors in the computation of benefits, especially where there are inaccuracies in the application of scheme rules, years of pensionable service, pensionable salary, vesting provisions or benefit formulas.

Another concern, he says, is poor record management and incomplete member information, including missing employment records, incorrect personal details, unupdated beneficiary information or discrepancies in contribution histories that affect benefit processing.

For retirees who believe the quoted amount is lower than expected, Mr Macharia advises seeking clarity before accepting payment.

“The first step is to formally raise the matter with the trustees of the scheme and request a detailed explanation of how the benefits were calculated,” Mr Macharia says.

Under the Retirement Benefits Act and Regulations, trustees are required to respond to complaints within 30 days. Members are entitled to information on their contribution history, employer’s contributions, the returns earned over the years, the applicable fees, benefit formula used and commutation or tax deductions.

“Where necessary, the authority will investigate the matter, request supporting documents from the scheme and issue directions to ensure members receive what they are legally entitled to,” he added.

The RBA has seen a growing number of enquiries regarding ill-health retirement benefits, preservation benefits after changing jobs and beneficiary claims following the death of members.

Retirees who suspect errors have a right to request fresh computation. If a member is dissatisfied, they can escalate the matter to the RBA. If they are still aggrieved by the authority’s decision, they can appeal to the Retirement Benefits Tribunal.

“Pension is one of your most valuable long-term financial assets, and safeguarding it is a shared responsibility between you, your employer, the trustees and the RBA,” Mr Macharia says.

He encourages workers to make additional voluntary contributions where possible.

The growing focus on retirement planning comes at a time policymakers are seeking to make pension savings flexible to meet people’s changing financial needs. Early this year, the RBA proposed that Kenyans be allowed to access part of their pension savings before retirement.

Under the proposal, a portion of the contributions would be channelled to a separate account that members could access under specified circumstances, including periods of financial hardship and for approved investment. The remaining savings would continue to be preserved for retirement.

Currently, pension scheme members can only access their retirement benefits before the normal retirement age in limited circumstances, such as upon changing jobs or becoming unemployed, subject to the rules governing their schemes.

A standoff over a Sh299 billion service fee over 13 years prompted the Ruto administration to cancel a deal with a consortium of French contractors for the construction of the Rironi-Mau summit toll road.

Fresh Treasury disclosures have revealed the secret fee – Sh23 billion annually – that would have been financed through debt as French firms continued to collect toll charges from motorists using the critical 175 km road on a public-private partnership (PPP) contract.

Treasury officials reckon that the Sh299 billion pay, which was structured during the era of President Uhuru Kenyatta, was untenable given the tight public finance, triggering the cancellation of the French deal in favour of Chinese contractors.

The French consortium, comprising Vinci Highways SAS, Meridian Infrastructure Africa Fund, and Vinci Concessions SAS, had inked a deal in September 2020 to build the highway and recover its investments over 30 years.

But it agreed with Kenya to pay the Sh299 billion in the first 13 years to help the French firms recoup their investments speedily.

From year 14, Kenya was also expected to cover the toll shortfall in the event that fewer cars use the highway, tilting the deal in favour of the consortium.

The Treasury reckons the French deal failed to align with fiscal consolidation objectives, which demands reducing the budget deficit and stabilising public debt, despite talks that aimed at restructuring the commercial project.

‘Significant macroeconomic developments during the 2020-2022 period including sustained global inflation, depreciation of the Kenya shilling, tightening fiscal space, and rising public debt service obligations materially affected the assumptions upon which the original project agreement had been developed, necessitating a reassessment of its long-term affordability and fiscal sustainability,’ Treasury Cabinet Secretary John Mbadi said in disclosures seen by the Business Daily.

‘The reassessment undertaken by the government established that the original project agreement no longer aligned with fiscal objectives necessary to support sustainable infrastructure financing.’

Kenya last year terminated the highway expansion deal with the French consortium and handed it to Chinese contractors, with National Social Security Fund (NSSF) getting a piece of it.

It paid off the consortium led by Vinci Highways Sh7.3 billion to avoid a costly legal battle in London.

The deal to turn the single-lane road into a multilane highway linking Nairobi to Kericho was signed in Paris in 2020 during a visit by then President Kenyatta.

Kenya’s decision to cancel the contract came after the government unsuccessfully sought to revisit the terms of the agreement, which it warned put the risk from insufficient traffic on the taxpayers.

The French consortium was awarded the contract on September 30, 2020.

However, the deal was cancelled by the Ruto administration even before the contractor commenced the works, ushering in Chinese contractors. The development came after Dr Ruto visited Beijing in April 2025.

Initially, there was a push to have Chinese contractors settle the Sh7.3 billion compensation bill and inherit the works done by the French contractors, like the feasibility fees. However, this was dropped during President Ruto’s visit to China, leaving the bill in the hands of Kenyan taxpayers.

The Treasury said earlier it pursued an out-of-court settlement to avoid a costly and protracted suit at the London Court of International Arbitration. Kenya was also fretful that without the payment, the French would block attempts to take away the contract-a move that would have marred the President’s Beijing tour in April 2025.

Besides the Sh299 billion service charge, Kenya was uncomfortable with the high toll fees. Motorists were to pay $6 (Sh780) to drive 175 kilometres in a small car and close to $50 (Sh6,500) for a truck to go the same distance under the French deal.

Under the current deal, a consortium of China Road and Bridge Corporation (CRBC) and the NSSF is building 81 kilometres from Nairobi to Gilgil via Naivasha and a 58 Kilometre stretch from Nairobi to Naivasha through Maai Mahiu.

Another Chinese firm – Shandong Hi-Speed Road and Bridge International Engineering (SDRBI)-will construct 94 kilometers from Gilgil to Mau Summit.

The projects were launched on November 28, 2025, and construction is currently ongoing.

The government will receive 60 percent of excess profits from the Rironi-Mau Summit toll road in a move aimed at limiting the potential for excessive earnings by the Chinese firm during the 30-year concession period.

Treasury documents show that the owners of the road will transfer to the State 60 percent of earnings above the agreed 16 percent of the internal rate of return (IRR) on equity.

Negotiations with the two Chinese firms also saw the exclusion of a minimum revenue guarantee (MRG), which would have required that the State to compensate the operators if toll collections fall below an agreed level.

This means that the project’s demand and revenue risks have been transferred to the private sector.

The NSSF will take a Sh9.59 billion stake in the consortium with CRBC on an ownership split of 40 percent and 60 percent.

The pair is projecting to make an annual dollar return of about 13 percent on their investment via user fees or toll charges.

They will fund their investment through a 25 percent equity injection of Sh23.97 billion and debt of Sh71.89 billion, with the NSSF contributing 40 percent of the equity component.

The profit share model marks a departure from the demand-risk model used for the Nairobi Expressway, where the Chinese operator absorbs losses if traffic volumes fall short of projections, but retains all excess revenue when usage exceeds expectations.

The Nairobi Expressway has not made a profit since its launch, with operational costs always exceeding toll revenues.

President Ruto is keen to see the project completed before the next General Election in 2027, viewing it as a key selling point to residents of the Rift Valley, western Kenya and Nyanza regions, where motorists often endure long traffic snarl-ups, especially during the festive season.

This project forms a critical part of both the Northern Corridor and the Trans-African Highway, serving as a vital transport artery that links East and Central African countries to the Port of Mombasa.

The highway plays a key role in supporting the movement of goods and services across the region, accommodating a substantial volume of heavy commercial traffic that is essential for regional trade and economic development.

Government and media relations have traditionally been tenuous; governments looking at the media as snoozers in affairs deemed good for the citizens while media holding governments accountable on public interest issues.

This is a normal professional thing that must be accepted and respected. Nothing personal.

Challenge has been, in our governments, everybody is a media and communication ”experts’ or has some beef with the media while a few journalists/editors have some personal scores with government to sort.

This has escalated the tensions between governments and the media, to a level that is very unhealthy and dangerous. Its now settling of personal scores, in most of the cases, by both the government and a few people in the media.

This is a big threat to not only freedom of expression, but a big economic threat to an industry that employs thousands and for citizens who depend on the media to access vital information on what the government is doing for them.

Oversighting government is a critical routine exercise that cannot be stopped or turned into personal wars-This oversight is done at all levels, including by public funded institutions such as Parliament, the Auditor General, Controller of Budget, EACC, DCI, Civil Society organisations, embassies, lending institutions, and the media.

Several reports by the institutions on government programmes exist, and corrective actions including arrests, indictments and punishments. To single out media as the only institution that must be punished for its watch dog is unfair.

It’s wrong to personalise this relationship between the government and the media-let the issue remains professional and respectful devoid of settling personal scores. Investors in the media sector are suffering, for the returns from the investments are reducing day by day, staff live in fear, while insurers have shunned the industry.

Governments in East Africa own media outlets especially the national broadcasters, in addition many members of Parliament including those in Government own media houses, and why they have never used this to influence public discussions and cry foul over a few privately owned media outlets remain baffling.

While the media has historically been viewed as being overly aggressive and insatiable in their plight for the latest and hottest news, their watchdog-type function is essential in a democratic society where people MUST know what their governments are doing.

The media has the capacity to hold governments accountable, forcing them to explain their actions and decisions, all of which affect the people they represent. As has been said again, any society that ascribes to democratic ideas, people should know all their options if they are to govern themselves and the media is a vehicle for the dissemination of such information.

The media plays a surveillance and watchdog role, disseminates information, entertains, educates and sensitizes the public to act.

The flow of information is important for the development of communities and the media facilitates this.

Without a wide array of information, people’s opinions and views would be limited and their impressions and conclusions of the world around them stunted. Journalists are in essence interpreters of information.

Governments in the East African region have always through speeches reminded us how they consider the media as partners in driving the development agenda and strive to promote a free environment in which the media can operate.

They commit not to allow our countries to slide back to the dark era of gagging the media, harassing of journalists, constraining media space and violation of media freedom that are fundamental to good governance.

Journalists on the other hand commit to remain professional and responsible in the reporting of our countries, making their main agenda, being among the key narrators of regions story.

As we move journalism and media practice from the adversarial engagement into the new realm of solution-based journalism, constructive journalism and development journalism, it’s possible that governments and the media relook at their relationship, from being always adversaries to partners without either compromising the independence and effectiveness of the other.

The media is an invaluable partner in communicating government development agenda, promote our core values, good governance and democracy on which a successful nation building is done.

Otherwise, the region’s agenda will continue being determined and shared by the international media and digital platforms where mostly the local story gets lost.

Strategic government communication, frequent proactive information disclosures especially around mega projects, public private partnerships and clear messaging are critical while professional use of editorial discretion and application of the request for information as guided under the Commission for the Administration of Justice- the Access to Information law is highly recommended for the media.

There is no option; public interest journalism requires investment into digging for information and courage from the media. Media cannot afford to manipulate information of spread misinformation and falsehoods.

Governments in the region have a responsibility to invest in the media through strengthening national public broadcasters, government owned websites and news agencies- which will relay government communication while at the same time creating a conducive working and business environment for private media to flourish.

Giving business to media, tax waivers on media equipment and establishment of media support funds are critical considerations to enable media, critical player in national development operate. This is important in supporting media viability, especially in raising professional and ethical standards in the media. Journalists need to be paid.

Even with the era of fast-evolving social media phenomenon for communication including for governments, traditional media is still strong especially outside urbans areas, integrated communication is the best approach. Lets have a human face and national interest in the media and government relations, for the country needs both.

Growing up in Kenya in the 20th century, Reddy Kilowatt, a cartoon character with a red, lightning-bolt body, was a familiar brand icon for the Kenya Power and Lighting Company (KPLC).

I did a little research and found that Reddy Kilowatt is a character used by many other electricity utilities. He was created by the American Ashton Collins of the Alabama Power Company and launched as a company symbol on March 11, 1926.

In 1934, the Philadelphia Electric Company became the first utility licensed to use the Reddy Kilowatt trade and service marks. Thereafter, over 200 electricity utilities worldwide used the icon under licence.

Fun facts aside, KPLC is, surprisingly, a trailblazer in the corporate governance space in Kenya. How, you ask, as you scramble to buy prepaid tokens when your phone battery is hovering at two percent and the beeping warning on your electricity meter has slowly turned into a mind-numbing screech?

Over the last few weeks, I have been commenting on the rollout of the Government Owned Enterprises (GOE) Act 2025, a piece of legislation whose objective is to bring world-class professionalism to the way state-owned corporations are managed in Kenya. In practical terms, it is intended to move public ownership away from a fragmented parastatal model and towards a more disciplined, transparent and commercially driven ownership framework.

At least two years before the GOE Act was assented to, KPLC began a governance improvement process to remove the majority shareholder’s involvement in the nomination of independent directors. In November 2023, the company held an Extraordinary General Meeting to make changes to its Articles of Association.

First, the Articles, which had provided for not less than seven and not more than ten directors, were amended to specifically provide that at least a third of those directors should be independent non-executive directors (INEDs).

Secondly, the amendments required that the board composition should fairly reflect the company’s shareholding structure. The key operative word here is “fairly”. Given that the Kenyan government’s shareholding stood at 50.1 percent, it became crystal clear what the board composition should reflect.

Thirdly, and more interestingly, the proposed amendments to the Articles of Association created two classes of ordinary shares to distinguish voting rights. Class A shares were held by anyone other than the National Treasury, while Class B shares were those held by the National Treasury.

Class A shareholders were entitled to elect four directors to the KPLC Board. Class B shareholders, or the government as it were, were entitled to appoint the rest of the Board. The stage was now set for an interesting Annual General Meeting (AGM) the following month.

Who would those independent directors be, given that they were supposed to be nominated by the minority shareholders?

Having been electrified by a bolt of new governance, the company embarked on a process to professionalise its board composition.

An Appointment of Directors Policy was adopted by the company, a simply written and easy-to-understand eight-page document that clearly set out the process for the who, the what and the how of building the KPLC Board. Most importantly, it was here that the new governance framework was embedded: the National Treasury would not be involved in the selection process for INEDs, thereby ensuring that they reflected professional skills and diversity.

The policy made it clear that at the AGM, director nominees from minority shareholders would be presented for election, while the appointment of the National Treasury nominees would only be noted.

Even though the policy provided for a clearly defined array of professional skills, an external independent adviser was appointed to conduct a skills assessment, identifying the expertise needed for electing INEDs.

The identified skills were engineering, finance, technology and governance. Minority shareholders were invited to submit their nominees.

Forty-eight candidates were nominated for consideration. A board committee, from which the government appointees were recused, reviewed the nominations and submitted the names and professional profiles of the final nominees to shareholders at the December 2023 AGM.

Elections were held without gnashing of teeth or tearing of sackcloth. The minority shareholders exercised their governance-given right to elect their preferred candidates, with zero interference by the majority shareholder from start to finish.

The result: a strong, professionally driven group of INEDs now sits alongside the National Treasury and Ministry of Energy appointees, the managing director and two government-appointed individual directors.

The level of transparency that KPLC demonstrated ahead of the enactment of the GOE Act is not only admirable, but also sets a very public precedent that other Nairobi Securities Exchange-listed GOEs cannot ignore.

The shambolic Kenya Re AGM held in June 2026 is a case in point. Perhaps they should dial *977# to report the governance blackout in their boardroom.

Will the Capital Markets Authority bell the cat on the new governance order currently envisaged by the GOE Act? We wait and see.

Commercial banks have cut lending to State corporations by more than two-thirds, or Sh59.7 billion in two years as legal reforms and tighter National Treasury controls prompt lenders to reassess the creditworthiness of public enterprises.

Central Bank of Kenya (CBK) data show net domestic credit to parastatals fell to Sh28 billion in March 2026 from Sh87.7 billion in March 2024, a decline of 68.1 percent.

Banks almost halved their exposure over the past year alone, reducing outstanding loans from Sh55.7 billion in March 2025 to Sh28 billion in March this year.

The retreat coincides with the implementation of the Government Owned Enterprises (GOE) Act, 2025, which is reshaping State corporations into public limited liability companies and changing how lenders assess their credit risk.

The law repeals many statutes that established State corporations and requires the entities to become companies under the Companies Act, part of reforms aimed at commercialising public assets and attracting private investment.

The changes complement the Privatization Act, 2025, the National Infrastructure Fund Act, 2026, and the recently-enacted Sovereign Wealth Fund law, signalling a shift in the management and financing of public assets.

Law firm Bowmans says lenders should stop treating State-owned enterprises as quasi-sovereign borrowers just because they are government-owned.

Instead, banks should assess each enterprise on the strength of its own balance sheet, profitability and cash flows rather than assumptions of implicit government backing.

Bowmans lawyers Aleem Tharani, Dominic Indokhomi, Edwin Baru, Nairuko Kantai and Qabale Guyo say the GOE Act leaves crucial questions unanswered over existing government guarantees and support arrangements.

“The GOE Act is entirely silent on the treatment of government guarantees, letters of support and letters of comfort. Lenders should not assume continued sovereign support and should reassess GOE credit risk on a standalone basis,” they wrote in a note in May.

They added that guarantees issued to statutory corporations may not automatically transfer to successor companies, depending on how the agreements were drafted.

Although successor companies inherit assets, liabilities and contractual obligations, the GOE law does not expressly preserve guarantees or comfort letters tied to the previous legal entities.

The uncertainty could affect how banks price loans, assign risk weights and determine future lending to State-owned enterprises undergoing conversion.

Bowmans also warns that financing agreements linked to statutory borrowing powers may require renegotiation, waivers or legal confirmations to remain enforceable after the restructuring.

The firm says mandatory audits before assets and liabilities are transferred could uncover previously undisclosed debts, litigation or contingent liabilities that materially weaken the financial position of affected enterprises.

The GOE Act sets no deadline for completing the conversion process, potentially prolonging uncertainty for lenders, investors and the corporations themselves.

Bowmans advises lenders to review loan books, security arrangements, guarantees and other exposures linked to State-owned enterprises.

Where lending decisions relied on government support, the firm recommends obtaining written confirmation from the National Treasury on whether such backing will continue after conversion.

The decline in bank lending also coincides with tighter Treasury controls over borrowing by State corporations.

Treasury Cabinet Secretary John Mbadi has directed State corporations not to obtain loans, overdrafts or any other credit facilities without prior approval from the Treasury and their parent ministries.

He also barred the Treasury from approving new borrowing or issuing guarantees for State corporations that have defaulted on loans or accumulated pending bills, limiting access to fresh commercial credit for distressed entities.

Across East Africa’s banking sector, digital transformation is no longer a competitive advantage; it is the baseline for survival. Over the past decade, financial institutions have invested heavily in mobile banking, digital channels, automation and core system modernisation.

These investments have expanded financial inclusion, scaled digital payments and transformed the interaction of customers with banks.

Yet the pressure on banks continues to intensify. Fintech competition is growing; regulators are being more careful, cyberthreats are becoming more advanced and customers expect fast, personalised and seamless experiences. At the same time, AI is beginning to reshape the future of financial services.

The question is no longer whether AI will impact banking, but if institutions are building the foundations needed to deploy it responsibly, securely and at scale.

The banking landscape in East Africa is often discussed as a single market. The reality, however, is more nuanced. Kenya’s highly mature mobile money ecosystem has created some of the world’s most digitally engaged consumers.

Rwanda continues to advance its digital-first government and financial inclusion agenda. Uganda and Tanzania are making more people use digital banking. Ethiopia’s financial sector reforms are creating new opportunities for innovation and competition.

Despite these differences, banks across the region face a common challenge: how to evolve from digital service providers into intelligent, data-driven enterprises capable of operating in increasingly connected financial ecosystems.

Customers have become accustomed to real-time payments, mobile-first services and frictionless digital experiences. According to industry and regulatory reports, digital transactions are growing quickly in East Africa. This is because more people are using mobile money, smartphones and digital financial services.

As expectations rise, traditional operating models built on siloed systems and fragmented customer data are becoming increasingly difficult to sustain.

Regulators are also raising the bar. Across the region, governments and central banks are strengthening frameworks around data protection, cybersecurity, operational resilience and consumer protection.

Kenya’s Data Protection Act and reforms in Ethiopia, Uganda, Tanzania and Rwanda point towards a future where governance and trust become key differentiators.

At the same time, open banking principles, interoperability and API-driven ecosystems are gaining momentum. While progress varies, the direction is clear. Banks are moving from standalone institutions towards ecosystem participants that work with fintechs, merchants, telecommunications providers and other digital service partners.

Ecosystem-based banking can unlock new revenue streams through embedded finance, digital partnerships and platform-based business models. However, it also introduces greater complexity, including integration challenges, increased cyber risk and heightened compliance obligations.

The future-ready bank will not simply process transactions. It will learn, adapt, predict and collaborate across an increasingly interconnected financial ecosystem.

Many institutions are still grappling with legacy systems and fragmented data environments. This is particularly important as AI adoption accelerates.

AI is only as effective as the data that powers it. Without trusted, accurate and well-governed data, AI can amplify risk rather than reduce it. Before banks can realise more advanced AI capabilities, they must establish strong foundations through enterprise-wide data governance, secure integration and effective risk controls.

This is where the concept of the intelligent or agentic enterprise becomes relevant.

An agentic enterprise should not be viewed as a fully autonomous organisation run by AI. Rather, it is an organisation where AI helps analyse information, support decision-making, automate routine processes and coordinate workflows, while remaining governed by clear policies, human oversight and regulatory controls.

In banking, these capabilities can help detect fraud, improve compliance, speed up customer enrolment, improve credit decision support and improve efficiency. However, such outcomes are only achievable when institutions first establish trusted data foundations and resilient technology architectures.

Integration is equally critical. Modern banks require secure, API-led connectivity between core banking platforms, digital channels, cloud environments, fintech ecosystems and regulatory systems.

Integration is no longer simply an IT function; it is a strategic capability that determines how quickly a bank can innovate, adapt and scale. These capabilities enable banks to innovate faster while maintaining security, compliance and customer trust.

For banking executives, the business case is clear. Those that build smart business capabilities can improve customer experience, save money, stop fraud, speed up sign-up, follow the rules and make more money.

Ultimately, the future of banking in East Africa will not be defined by who digitised first. It will be defined by who builds the most intelligent, connected and trusted enterprise.

The journey towards agentic banking will not happen overnight. Many institutions are still addressing legacy infrastructure, fragmented data and evolving governance requirements. But the direction of travel is clear. Banks that invest today in data, integration, cybersecurity and responsible AI foundations will be best positioned to compete in the next era of financial services.

The future-ready bank will not simply process transactions. It will learn, adapt, predict and collaborate across an increasingly interconnected financial ecosystem.

Arnaud Suquet may be a diplomat by contract, but travelling is his true profession. He became a diplomat because he loves to travel. Well, obviously that’s not the only reason. There’s also the education, the political capital, the savoir-faire, and the art of schmoozing between the state of affairs and affairs of the state. “I got attracted by a very romantic vision of what being a diplomat was,” he says. “Travelling in a good suit. Having a Panama hat. Riding in a fancy car.”

Now, as Ambassador of France to Kenya and Somalia, he wears more suits than Panama hats, rides in a fancy car, yes, but mostly to shake hands, kiss babies, and work the room. He won’t be in Kenya for very long, he concedes; this job demands that he changes stations often. Till then, he wants to leave a small piece of himself on the slopes of Mount Kenya, and in so doing, conquer his own personal mountain. “I want to do it with my daughter,” he says. Before that, he has to settle a diplomatic squabble: croissant or mandazi, the most pertinent diplomatic tiff of our time. How does he plead? “Well,” he says, “Why can’t it be both?”

What’s it like for you to be who you are? Being an ambassador means you always represent your country. You don’t totally own yourself. You are on stage for your country. It’s been almost four years in Kenya, and it’s been a great experience. Kenya has never disappointed me.

What’s your most Kenyan habit? [chuckles] I’ve got to run more intensively since I’m in Kenya. I mean, I’m an amateur runner. Now I am a more regular runner, especially in Karura [Forest], early mornings. I also did the City Run recently and had a coffee afterwards. After sports, ni sherehe [chuckles]. I made an effort to learn Kiswahili, you can see, haha! I have been fairly consistent, and it has been fantastic. Now I am trying a bit of sheng too.

Why was it important for you to learn Swahili? First, as a personal challenge, I can still learn at my age. But it’s an eye-opener on a society, and I couldn’t picture myself staying a few years in Kenya without making the effort to understand better. And language is a classical entry point. You get to know the culture. I learned Kiswahili through animal books, Sungura Mjanja [chuckles]. But we quickly transitioned to day-to-day Swahili, mambo ya ground [chuckles]. I especially love the Swahili methalis.

How is it learning languages as an older man? It makes your brain exercise. Learning a language is like doing sports; you need to activate your brain. And I feel even at my age and leadership position, you still have to learn and listen. And it is humbling because when you are learning a language, you are a student making mistakes.

How has fatherhood been for you? I am a father of two teenage girls. It’s nice, but it comes with a series of challenges. You are trying to pass on a few values and principles to the next generation. But in this line of work, we have to travel from one country to another. And every four years, we change our environment. I think sometimes it’s tough on the children; they embrace change but also like stability. But it’s also exposure to different societies; you may not like it as a teenager, but it will build you.

How are you making sure that you are not living your dream at the expense of theirs? It’s not an easy question, but the key is to talk about it. And to listen to their point of view. Parenting is also making decisions while listening to their concerns and aspirations. It’s all a work in progress.

What frightened you most about being a father? You always want to get it right for your children. And at the same time, you need to leave them some freedom to be their own. You want the best for them, and at the same time, you tend to push too much, and that means there will be pushback. You need to give space for your children to develop their own thinking without being overbearing; it’s a challenge.

What do you hope your two daughters never have to forgive you for? I hope they will understand that we have to move from country to country and change friends regularly. Which is important, but at the end of the day, we need this experience all together. We share some emotions and beautiful experiences, and that will create memories for us to cherish. But it’s also a growing path; however difficult it is, you enrich yourself with those experiences. I didn’t want to do what my parents did, so perhaps my children don’t want to do what I am doing, at least for now [chuckles].

You said you move often; how do you allow yourself to get close to people knowing you’re still going to leave?

Everybody has to leave at one point. You don’t do your job efficiently if you don’t understand the context you’re operating in. I spent a lot of time listening and getting to know people, creating contacts because you cannot operate in a vacuum. Then you nurture those contacts, keep track of and check on people, and see how you can support and work with them.

Are you living your dream, or has this career been bigger than that dream?

I didn’t know I would be a diplomat. I had an interest in travel, building curiosity about other societies. At one point, you can stay at school or university; it’s very comfortable, but you need to make a living. So I asked myself: What can sustain this way of life of travelling? And not just as a backpacker or tourist, but you get paid [chuckles]. That’s really the idea of diplomacy. I got attracted by a very romantic vision of what being a diplomat was. Travelling in a good suit. Having a Panama hat. Riding in a fancy car.

That’s not it? Not totally haha! I got to learn that it’s a job you have to work hard to get into. You have to learn and strive to make it. But also, like any profession, you have to be serious and rigorous. Especially when you represent your country. It’s a big responsibility. It’s not just riding in a fancy car with a Panama hat [chuckles].

Yet that job involves many strategic alliances. How do you know at a personal level when someone is real and not just schmoosing?

Diplomacy works on the premise of trust. Trust needs to be built. It’s a bit like tango; you need to be at least two to dance. Building trust is what matters. Sometimes you need to give it a chance. Sometimes you will be disappointed; sometimes you will be rewarded even more than you think.

What do you miss about your younger self? When I used to run or play tennis, I didn’t have cramps [chuckles]. Your body tells you. You get to know that you cannot do the things you used to do. But there are some other things you enjoy at a certain age.

What does running give? It clears your mind. Instead of overthinking things, you listen to your body; it’s an excellent break, and for me sets the tone for a good day.

Does the ambassador have any secret talents? I’m a decent tennis player; I’ve played with Angela Okutoi, your best female player. But, as a balozi, I knew I had to play with her against others. That’s how we won [chuckles]. But I think tomorrow I’m playing, and this is going to be tough; that’s going to be a humbling experience. I’m going to play against your best male player, Ismael. I don’t know if I have talent, though.

Will you let him win? No, I will try to win, but I think it will be an impossible mission, but I’ll do my best.

What do people often misunderstand about you? That I am balozi mchapakazi, but I also like to enjoy life, social things, getting to know people and having a light moment.

If your life were to end in six months, what’s one thing you would do that you’ve been putting off? I’ll fly to Mount Kenya. I did part of it with my daughter, but I think even before I leave Kenya, I need to summit it. It’s a challenge, but it is also particularly scenic and has some spiritual component. I’d like to do it with my daughter.

How do people show you love? Checking on me from time to time to see if I am okay.

I imagine that, as an ambassador, people think you have it figured out, so perhaps they may not be checking on you often. How is your experience? Yes, but I think some people check on you because they see you beside the job or the assignment; that there is a human person. But you are what you are but you are also a human being, and some people see that. And so they’re just not asking how the ambassador is; it’s also ‘How are you?’

How are you? I’m good [chuckles]

What does your buried life look like? I would have been doing sports. Just try to exercise a little bit, you know, in between meetings.

What has success not fixed? Don’t get satisfied. I mean, you can be proud of what you do, but never be too comfortable or satisfied. The idea of change and putting yourself outside of your comfort zone drives you. You can always do better. We all make mistakes. Sometimes I wish I had more time to do more things, but a day is only 24 hours. And it is what it is. But I have to prioritise climbing Mount Kenya.

Sometimes we can trade the immeasurable for the immeasurable. How are you ensuring that, in all this ambition, you are still balancing your life? Sometimes you just need some time for yourself. You have to be cognisant of the fact that, you know, your schedule is what it is. You cannot just close your laptop at 5pm and say, I’m done. But sometimes you need to escape. You need to take some time for yourself to disappear a little bit. I just came back from one week off, and I decided it on last minute. For me, breaks are not improvised, but spontaneous.

When is it enough? If you think that you have enough, change what you’re doing. It’s probably time for you to do something else.

What have you finally come to terms with? Age, maturity, and being an elder gentleman. It comes with a set of challenges, but it also comes with, I hope, some sense of wisdom; to look back at things and not regret my younger years. I am happy where I am now.

What has been the best part about growing older? There are things you don’t really care about anymore. When you’re young, you always need to prove yourself. When you grow older, you have less of this drive to show others. That you can do it. You come to terms with what you’ve become.

What does freedom mean at this stage in your life? Freedom is about picking your own battles and not fighting on behalf of others. That’s real freedom for me.

If you’re mentoring a younger self, what’s the one thing you’ll tell him? When you want something, don’t compromise. It may take a longer path, but don’t settle for something you don’t want. Just be clear and then push for it. Accept failure or the fact that you won’t necessarily get there in the sort of time or in the path you wanted to take, but don’t compromise on what you believe in and your objective. It will take some time, but eventually you’ll get there.

Who do you know that I should know? Coster Ojwang. I like his music, and this industry is still nascent, but I hope we get to a space where doing art is not a side hustle, but a profession.

What’s the soundtrack of this moment? “Finale” by Bien and Ali Kiba, which I must say, is very timely, given the current situation in France. One of the semifinals will be on Bastille Day, which is our national day, on July 14. Crossing fingers, France gets to the semi-finals. That will be fantastic, no? We need to do a watch party that day, so cheer for France now, for Mbappé, Olisse, Dembélé [chuckles].

As artificial intelligence (AI) makes businesses smarter and more efficient, it is also making cyber risks more complicated.

For years, companies buying cyber insurance worried about familiar threats like ransomware attacks, phishing emails, data breaches and network outages. While these risks remain, AI is changing how cybercriminals operate and the types of mistakes businesses can make, forcing insurers to rethink what they cover and how they price it.

This comes as companies increasingly embed AI into daily operations to optimise productivity, from customer service chatbots and software development to fraud detection and data analysis.

However, this is also opening the door to cybersecurity risks that did not exist a few years ago. Cybercriminals are increasingly using AI to automate the discovery of software vulnerabilities, generate convincing phishing emails and create deepfake audio and video capable of fooling employees into transferring money or disclosing confidential information.

At the same time, businesses deploying AI systems are creating new forms of risk that may have nothing to do with hackers. An AI model, for instance, can hallucinate inaccurate information, inherit bias from its training data, expose confidential information or fail in ways that disrupt business operations.

At the same time, training datasets can be manipulated by injecting malicious or misleading data into an AI or machine learning model’s training dataset, technically called data poisoning, which makes it produce unreliable or compromised outputs.

Because these failures often occur without any malicious third-party attack, many cyber insurance policies may not clearly cover the resulting losses.

As a result, insurers face a new generation of threats that fall outside the traditional boundaries of cyber cover.

Cyber insurance has historically focused on attacks by external actors who infiltrate company systems through stolen credentials, software vulnerabilities or social engineering.

Policies were designed to cushion businesses against financial losses arising from ransomware, data theft, phishing attacks and business interruption following a cyber incident.

The law firm Bowmans says this uncertainty has prompted insurers to change how they evaluate clients. Instead of asking if a business has antivirus software or firewalls, insurers increasingly want evidence that organisations have proper AI governance structures, human oversight, monitoring processes and controls over third-party AI vendors.

‘A defensible AI governance policy and evidence of governance, once niche considerations, are becoming a prerequisite for meaningful coverage and favourable pricing,’ Bowmans said in a recent analysis.

The insurance industry is also using AI to underwrite insurance more effectively.

Insurers are analysing a company’s digital footprint, internet-facing systems and historical cyber incidents in real time, rather than relying solely on annual questionnaires.

This has made risk assessments evolve continuously rather than once a year.

At the same time, insurers are beginning to redesign their products, with some adding endorsements that explicitly cover AI-related incidents such as unauthorised disclosures through AI systems, social engineering fraud or failures involving third-party AI providers.

Others are introducing exclusions where businesses deploy AI without adequate governance or where losses arise from algorithmic decision-making.

Entirely new insurance products are beginning to emerge, covering regulatory investigations linked to AI governance failures, intellectual property disputes involving AI-generated content and business interruption caused by AI model failures or corrupted training data.

Though the market is still in its early stages, it signals a shift in cyber insurance from covering only network breaches to addressing a wider range of AI-driven business risks.

The trend is becoming increasingly relevant in Kenya as businesses accelerate investments in cloud computing, digital platforms and AI.

Cyber threats are among the fastest-growing operational risks facing organisations. Between January and March 2026, the Communications Authority of Kenya (CA) recorded more than 3.3 billion cyber threat events.

According to the regulator, many of the attacks were fuelled by inadequate software patching, low awareness of phishing and social engineering tactics, and the increasing use of AI and machine learning by malicious actors.

Attacks targeting operating systems, databases and network infrastructure were the most common incidents, while malware, distributed denial-of-service attacks and brute-force attacks continued to pose significant threats.

Kenya’s insurance industry has been responding to the growing demand for cyber protection, with firms – including APA Insurance, Aon Kenya, Britam and Zamara -already offering specialised cyber insurance products.

“We see new risks coming in with the adoption of technology and AI, and we want to mitigate that. Hacks and ransom demands are becoming a big threat,” Ashok Shah, the group Chief Executive of Apollo Investments, APA Insurance’s parent company, told the Business Daily in a recent interview.

“In this case, insurance coverage comes in so that clients do not need to pay ransom, but at the same time, their systems are protected.”

Analysts say AI governance, amid this increasing adoption, will become a key determinant of whether a company can obtain insurance and on what terms.

While many Kenyans rely on them for work, communication and entertainment, psychologists say there is a growing number of Kenyans whose dependence on smartphones has become a concern.

According to Wanjiru, excessive phone use becomes a worry when it starts interfering with normal functioning.

‘When one spends most of the time consuming social media, becomes non-productive in developing themselves or cannot function without a phone, then the excessive use is bringing a psychological concern,’ she says.

The warning signs are easy to overlook. Some people compulsively check their phones even when there are no notifications, while others experience ‘phantom vibration’, the sensation that their phone is vibrating when it isn’t. Many use their devices to escape boredom, loneliness or anxiety, while others struggle to stay present in conversations because they keep reaching for their phones.

‘One repeatedly intends to check one thing and wakes up from a scrolling trance an hour later,’ she says.

Stress, loneliness, boredom and work demands contribute to excessive phone use, but Wanjiru believes social media platforms are designed to keep people engaged.

‘People want to stay informed. They want to know the trending song or phrase, so they use their phones excessively,’ she says.

‘The apps are designed in a way that something interesting keeps popping up.’

Contrary to the belief that teenagers are the biggest victims, Wanjiru says adults are increasingly struggling to regulate their screen time.

‘It is between 20 and 50 years. Adults have the freedom to use their phones because they buy data and devices,’ she says.

Wanjiru says excessive phone use can heighten anxiety, damage self-esteem, strain relationships and reduce productivity.

‘Phone use leads to procrastination, which results in low performance,’ she says.

‘Social comparison affects one’s self-esteem because people feel others are achieving more than they are.’

Helping clients regain control does not necessarily mean asking them to abandon their smartphones. Therapy focuses on helping them become more intentional about using the devices.

‘The goal is to move from reactive to intentional usage. Ask yourself why you are picking the phone. Is it to send a message, work or simply scrolling?’ Wanjiru says.

She encourages simple habits such like keeping phones out of the bedroom, creating phone-free spaces during meals and setting boundaries around screen time.

For Wanjiru, the wider concern is what excessive phone use is doing to human connection.

‘The phone is making people isolate themselves. When you avoid people, you become lonely and lose your support system, which is important for mental health. In the past, people interacted through storytelling, music and communal activities,’ she says.

Salima Njoki Macharia, a psychologist and programme officer for Wellness at the East Africa Wellness Hub, says concerns about excessive phone use have become common, though they are rarely the reason people seek therapy.

‘What I’ve seen in the last few years is an increasing number of people who are concerned about their relationship with social media and phones,’ she says.

‘They don’t come to therapy saying, ‘I’m addicted to my phone.’ They come with sleep problems, low self-esteem, poor concentration, relationship rows or emotional exhaustion. As we explore, we realise excessive phone use is part of the problem.’

She cautions against labelling people ‘phone addicts’, saying the more appropriate professional language is problematic or compulsive smartphone use.

‘We are careful when using the word ‘addict’ as it becomes a label. We focus on whether a person feels unable to control how often or how long they use their phone, continues using it despite negative consequences, becomes anxious when separated from it or starts neglecting responsibilities and relationships,’ she says.

According to her, the issue is not the number of hours spent on a phone, but the impact it has on a person’s daily life.

‘People use phones for work, business, education and communication. The real question is, what impact is it having on your life? Has it begun interfering with your work, school, relationships or daily responsibilities? Is your sleep regularly disrupted? Are you using the phone to escape difficult emotions instead of addressing them?’ she says.

Macharia adds that several factors drive excessive phone use, including fear of missing out, loneliness, workplace expectations and social pressure.

‘People worry they’ll miss important news, opportunities or what their peers are doing. Others feel they must always be available because work, family or friends expect immediate responses. These factors make people feel they have to remain constantly connected,’ she says.

Consequences extend beyond screen time.

‘When people spend too much time on their phones, they can experience anxiety, stress, low self-esteem and loneliness. Relationships suffer because there is less meaningful face-to-face interaction and more conflict over divided attention. Late-night scrolling affects sleep, making people tired, irritable and less productive,’ she says.

Rather than encouraging people to abandon their devices, Macharia advocates gradual, realistic changes.

‘We identify the triggers around excessive phone use, track screen time and set practical goals instead of expecting complete abstinence,’ she says.

‘Create phone-free periods during meals or before bedtime, remove apps that encourage scrolling and replace screen time with activities you enjoy, such as exercising, reading or spending time with family and friends.’

‘I am working now, but I still use digital loans. Today, there is an unlimited supply of those loans. I can get them from multiple sources anytime,’ he says.

Ali’s experience mirrors that of millions of Kenyans who accessed their first formal credit through digital lenders, reflecting a quiet transformation that has reshaped Kenya’s financial sector over the past decade.

What began with a handful of digital lenders offering small, instant loans has evolved into an increasingly crowded financial technology ecosystem that is rewriting the rulebook and threatening a market long dominated by traditional financial institutions.

To keep pace, banks and insurers are increasingly courting the very startups that once sought to disrupt them, in what is becoming a case of: if you can’t beat them, join them.

Equity Group Chief Executive James Mwangi has admitted that there’s no certainty that banks, in their traditional sense, may not survive the onslaught by fintechs, which are more agile and are fast eating into the market traditionally dominated by banks.

‘What is certain is that financial services will be required, who will provide them is what is debated,’ Dr Mwangi said at a forum in March.

His fear is real. Over 70 percent of digital loans are disbursed by fintechs and not banks, yet it is the fastest growing segment. In insurance, more than half of the microinsurance market share is captured by startups deploying AI to serve low-income households.

Financial institutions, which are the among the most valuable firms at the Nairobi Securities Exchange (NSE) are not waiting for startups to eat their lunch. They are choosing to share it instead.

An increasing number of leading banks and insurers have created dedicated innovation or venture investment arms that not only develop technologies to complement their core businesses but also identify, incubate and invest in startups once seen as disruptors of traditional financial services.

Equity Group has created Finserve, which develops digital financial products and partners with fintechs. NCBA Group runs Loop, its digital banking platform, while also partnering with fintech firms through products such as M-Shwari.

KCB Group has expanded its digital innovation efforts through partnerships with technology startups and accelerator programmes. Last year, the lender bought 75 percent stake in Riverbank Solutions, a fintech providing agency banking, payment systems, revenue collection and business management software.

Insurers are also stepping up. Last week, Britam announced a plan to invest up to Sh1.9 billion in insurtech and fintech startups through its corporate venture capital arm BetaLab.

Kevin Mutiso, founder of digital lender Oye, which is among the first firms BetaLab invested in, believes this shift is not an indication of feeling threatened, but of the realisation of a need to cooperate for the betterment of the market.

‘Startups do not come to take away the market of legacy firms, they come to grow it. The question then becomes how we can grow each other faster and not how to edge out each other,’ said Mr Mutiso.

Experts contend that there is no winner without the alliance between startups and traditional financial institutions. Each bring strengths and weaknesses, and complement one another for better, and faster delivery of financial services.

‘Startups bring speed, experimentation, and customer-first product thinking. Traditional financial institutions bring trust, capital, regulation, distribution and scale,’ argued Ayisi Makatiani, CEO of Caava Group, an insurtech company.

‘The future will belong to those who combine both – not through loose innovation theatre, but through disciplined partnerships tied to measurable business outcomes. The real opportunity is not in one replacing the other but in collaborating.’

Beyond investing in and acquiring startups, collaboration with legacy financial institutions is evident. Of the 31 banks polled by the Central Bank of Kenya in its latest Banking Innovation Survey last year, none said it is taking a unilateral approach to innovation.

A whopping 86 percent said they are partnering or collaborating with external firms, and also outsourcing innovation solutions to third parties. 11 percent are only partnering, and 3 percent outsource.

For financial institutions, improved financial inclusion and better personalised services are the top benefit of product innovation to their consumers, cited by over 90 percent of lenders in the country. This is driving them to embrace startups more.

‘A few years ago, startups were mainly seen as competitors to established financial institutions,’ avers Mercy Kimalat, the CEO of the Association of Startup and SME Enablers of Kenya (Assek).

‘Today, there is a growing understanding that innovation in finance and insurance is most effective when startups, corporates, investors and ecosystem players work together.’

Yet, there are hundreds of startups that continue to struggle to scale and reach financial breakthrough. From a wider lens, only a few startups attract the attention of legacy financial firms.

According to Mr Mutiso, many startups are not yet investor-ready, and legacy financial institutions ‘are not ready to engage with all levels of startups,’ as many want to limit exposure.