Category: Business Daily

Consumers will miss out on the benefits of the fall in global fuel costs during the June 15 review of diesel, petrol and kerosene pricing after Kenya revised the formula for calculating imported petroleum.

Imported cargo shipped in the country between May 10 and May 31 will be based on the average global prices of diesel, petrol and kerosene in April, the new formula indicates.

Shipments that arrive between June 1 and June 9 will be based on the average prices for May.

The review of formula indicates that consumers will not enjoy fully the drop in the cost of refined fuel in May, notably in the second half of the month.

This signals that the government will have to deploy a larger subsidy to meet President William Ruto’s promise of cutting the cost of diesel by Sh10 per litre in the June-July pricing cycle to provide additional relief to consumers.

Global diesel prices fell to $1,132.04 (Sh146,576.53) per tonne in May from $1,409.28 (Sh182,473.57) in April, according to Platts-a global provider of energy and commodities information and benchmark prices.

Jet fuel dipped 23.4 percent to $1,167.92 (Sh151,222.28) per tonne from $1,526.69 (Sh197,675.82) in the same period.

Industry executives reckon that consumers will miss out on last month’s drop in the global prices in the hope of a deal between the US and Iran.

Oil prices recorded their biggest monthly fall since 2020 in May on hopes that a deal between the US and Iran will lead to the reopening of the crucial Strait of Hormuz.

The price of the international oil benchmark Brent crude fell almost 20 percent in May, declining steadily in the second half of the month as signs emerged that the two sides could be close to a deal.

‘Had they used the May Platts, prices should have come down in the June 15 review, even without the subsidy. But now this [drop in prices] won’t happen due to the change in the months used to price fuel cargoes,’ said an oil executive who sought anonymity.

Two cargoes of diesel and one of jet fuel were imported May 16 and May 30, with industry simulations showing that importers will pocket Sh6.079 billion on diesel and Sh3.702 billion on dual-purpose kerosene.

The energy regulator says that the changes are critical and will align the local pricing of fuel with the prevailing global trends, ensuring that consumers are not denied the benefits of a drop in global fuel prices in the long run.

‘Government wanted to achieve consistency and greater transparency in pricing. Two instances, one in 2023 and the other in the recent past where pricing may have been switched between the two halves to the detriment of the consumer forced the government to act,’ Joseph Oketch, the acting director-general of the Energy and Petroleum Regulatory (Epra), said.

Documents seen by this publication show that 176 oil marketers attended the meeting where the Ministry of Energy and Petroleum announced the changes.

‘The parties have agreed to amend Clauses 10.1.1.1 and 10.1.1.2 of the Agreement, regarding the pricing mechanism for delivered cargoes,’ a document from the Ministry of Energy and Petroleum shows.

‘For cargoes whose first day of delivery date range is between 1st to the last day of the month, the applicable month of pricing shall be the immediate month prior to the month of delivery, i.e., the average of the published quotation during the month (M-1).’

Public transporters staged a two-day strike last month against the rise in fuel prices in the wake of the Iran war.

That brought economic activity in Nairobi to a standstill and degenerated into clashes between protesters and police that left ?four people dead and about 30 injured.

The government, which each month sets a maximum fuel retail price that marketing companies can charge customers, last month hiked diesel price by 23.5 percent to Sh242.92 a litre for the May-June pricing cycle, but reduced it by Sh10 on May 18 in response to the strike.

President Ruto said his government had spent at least Sh28.1 billion to reduce fuel prices between April and June, straining public finances.

Kenya’s inflation accelerated for the second month running in May, hitting its highest in more than two years, largely due to fuel price hikes linked to the Iran war, hurting workers’ disposable income.

Inflation surged to 6.7 percent in May ?from 5.6 percent in April, the Kenya National Bureau of Statistics (KNBS) said in a report, with the rate being the highest since January 2024, when it stood at 6.9 percent.

The jump in inflation will hit workers hard amid reports that the cost-of-living measure has wiped out the marginal pay rises employers have offered staff in the past five years.

Inflation is ?now near the top of the government’s preferred 2.5 percent and 7.5 percent range.

The spike in energy costs is expected to reduce the Central Bank of Kenya’s room for further cuts on the benchmark rate, a prospect that will freeze the drop in lending rates.

The central bank is ?due to announce its next interest rate decision on June 9, after leaving its key rate unchanged at its last meeting in April.

Riddled with dependent parastatals, kneejerk preconceived supplementary budgets, and irrational taxation, it hobbles and bleeds a tiny fraction of the formal working population. How did Kenyans become the proverbial milk cows?

Incomplete reforms: For an overhaul, the Presidential Task Force on Parastatal Reforms (March 2013-November 2013) and the Parastatal Reforms Implementation Committee, November 2013-December 2014, reconfigured public finances and drains from parastatals.

Proposals identified, among others, the establishment of an Office of Management and Budget, a Government Investment Corporation to get rid of debt-ridden parastatals, and a world-class Sovereign Wealth Fund-vetted by the Committee on Implementation of the Constitution as a vehicle for Kenya’s incipient boom in natural resources worth trillions of shillings.

The proposals-had they been implemented then-could have helped rationalise government. Today, they are being ‘cherry picked’ in flawed rent-seeking vehicles against Article 206 of the Constitution.

The National Infrastructure Fund in particular is activated as a mongrel of the world-class and award-winning National Sovereign Wealth Fund Bill 2014. It aims to snare a pipeline of hidden public debt and corruption without accountability.

It is evident that no aspiring President of Kenya short of a relevant sound economic agenda, will have a leg to stand on hereafter, unless two cracks in macroeconomic policy are sealed: the fiscus and monetary policy.

Forays into infrastructure projects and Singaporean dreams are a hunt for funds that turn Kenya’s development potential on its head: for the reforms required to salvage the economy must start from existing economic sectors, with headline fiscal and monetary policy to drive investment and output mopping up mass unemployment, which can deliver results.

The late President Kibaki demonstrated how. The Finance Bill 2026 and proposed 2026-27 Budget signify deepening flaws. Expect the now familiar revenue underperformance.

To create hope and install a legitimate fiscus, a hierarchy of preparatory reforms are a prerequisite.

Today Kenya has the skilled Gen Z to hone capacities and capabilities needed to conceive, design, and implement the structural transformation envisaged by the Parastatal Reforms initiative of 2013-2014.

Until Kenya restructures, transforms, and aligns activities to investment, employment, and output priorities, and until the tax base is reframed to reflect productive opportunities for Kenyans, future governments will struggle, with taxation explosively misaligned to sources of gross domestic product (GDP). How can this be fixed to create hope and restore legitimacy?

Fiscal Policy: Cracks in the fiscus hibernated over decades to make taxation appear predatory, serving a thin band of compulsive elite spenders, while impoverishing the masses. Finance Bill 2026 works against leading sectors and suffocates private sector opportunities. As high as 82 percent of the population earn livelihoods in the informal sector. The formal sector hosts only 12 percent.

In the labour force of 23.8 million, only 3.1 million are formal sector workers; only less than 12.5 percent of those (387,418) earn Sh100,000 or more per month. With unemployment rampant, Finance Bill 2026 should endeavour to expand this narrow band, along with the formal corporate sector.

Efforts to overtax the band with regressive taxes worsen against ongoing corporate business closures. Revenue targets thus fail repeatedly while expenditures are as untamed in the national government as in the counties. The informal sector (MSMEs) must receive greater incentives to raise employment and the tax base.

Example: the Finance Bill 2026 and Budget 2026-27 raise tax on mobile transactions and gadgets, reversing world class gains Kenya has made in mobile financial innovations and associated employment. It depresses work for nascent highly skilled digital creatives.

By substitution, transactions will migrate to the underground and to cash. An IMF study in Cameroon, CAR, and Mali showed deadweight loss and efficiency costs reach 35 percent from similar policies. M-Pesa, Airtel Money, etc., should expect their electronic floats (aggregate balances in mobile accounts) to dwindle in favour of banks and mattresses? Who will energise digital creatives facing job cuts?

Obvious strategies to reset the tax base and tax fairness are to re-look sectors and their potential contributions to GDP. Economic activity follows from higher investment, employment, and growth of output. The tax base also rises, a key lesson and legacy from the late President Kibaki. Figure 1, based on KNBS Economic Survey 2026, ranks sectors based on contributions to GDP, 2025.

Agriculture, forestry, and fishing at 23.2 percent tops the list and should be a priority in the fiscus. It is also the foundation of livelihoods for a majority of Kenyans. Yet Kenya consistently spends less than three percent of revenues on agriculture.

The assortment labelled ‘Other sectors’ contains segments with dynamic potential for growth and tax base, on condition a well-managed transition to higher investment, employment, and growth is planned.

A notable sector is mining and quarrying. Contributing 0.8 percent to GDP, it can deliver dramatic economic gains worth trillions of shillings from Kenya’s natural resource wealth (coltan, gold, titanium and manganese, among others) through investment, employment, and growth opportunities.

A government focused on endowments could trigger a revenue boom by embedding lucrative value chains domestically. It can propel the manufacturing sector, which at present contributes a measly 7.1 percent- half its contribution after years of decline; it now ranks sixth, despite ample tax exemptions and imported inputs.

Monetary Policy: In advanced economies, fiscal policies are coordinated with monetary policies to stabilize the economy and supervise the financial system. Kenya’s banking system and financial sector profits handsomely from a small unsophisticated financial market.

Banks dominate lending and focus on government as a lucrative cash-cow.

The milk consists of customer deposits on the Liabilities side of their balance sheets (including deposits of Counties, Ministries, Departments, and Agencies (MDAs), and parastatals) on which banks pay low interest rates. Into this pool of deposits also go the electronic floats of Safaricom, Airtel, etc. So does large unutilized balances of the much-maligned Housing Levy.

Banks, from the Assets side of their balance sheets, then trade this milk, lending substantial sums to government in lucrative Treasury Bills and Bonds.

Private and foreign portfolio investors join the queue as do Pension Funds and unutilized Housing Levy balances parked in short-term government securities. Banks add a wide monopolistic interest margin called the spread and earn lucrative returns on equity (ROE) playing weekly and monthly auctions at CBK.

In 2024 ROEs reached 20 percent while US banks earned ROEs of 10 percent, half that figure. It explains why Kenyan banks consistently rank among the most profitable globally by ROE.

Problem: Government’s redemptions of securities using taxpayer funds to pay interest on its funds (as well as funds initially deposited by MDAs, Counties, and parastatals etc.) further raids taxpayers’ money to pay the banks. Government thus increases taxes to pay high rates of interest on securities lent to it partly from taxpayers money deposited in the banks.

The Parastatal Reforms team attempted to cure this impact by proposing a Treasury Single Account (TSA) at CBK for Government and MDAs, etc.

Redemptions using government revenue translate to public debt service factored in budgets. Interest Payments have risen to 40 percent of Revenues while Total Debt to GDP is over 90 percent.

Finally, the negative impacts on our financial sector defy CBK attempts to direct lending to the private sector and support capital formation as part of monetary policy. In February 2026, for the 10th consecutive rate cut, CBK cut the Central Bank Rate (CBR) by twenty-five basis points to 8.75 percent. Its decisions are highly compromised as shown in Fig 2.

Depositors in the banking system (who should be able to borrow for economic activity in financial intermediation) have little or no access to credit. Private sector access limps as credit to government ‘Crowds Out’ private sector credit.

Fig 2 shows the full impact. Worldwide, Private Sector Credit is the main driver of the GDP, investment, employment, and output. Fig 2 shows ratios topping over 190 percent for USA, China, and Japan.

Kenya shoots itself in the foot with a financial sector that fails the Real Economic Sectors by perpetually starving them of capital for investment, employment output, and capital accumulation. Kenya has a lower access to credit at 31.6 percent. than Sub-Saharan Africa (SSA) average of 33.1 percent.

To paraphrase Hernando De Soto’s famous dictum on ‘Dead Capital’ Kenya is a leading Poster child for ‘Why Capital Accumulation succeeds in the West and Fails Everywhere Else’

Data from the Central Bank of Kenya (CBK) shows that lenders posted a cumulative pre-tax profit of Sh83.5 billion in the first quarter of the year, up from Sh73.5 billion in the same period last year.

The performance is limited to the banks’ operations in the Kenyan market.

Kenyan banks have been quick to cut the cost of deposits while remaining slow to reduce lending rates, allowing them to enjoy wider revenue margins.

Credit growth

The volume of loans disbursed by banks rose eight percent to Sh4.45 trillion during the review period, marking the fastest credit expansion recorded by the industry in two years.

The CBK said demand for credit from the trade sector and households was attributable to increased working capital requirements.

The credit expansion followed pressure from the CBK on banks to lower lending rates in order to spur private sector borrowing. The regulator cut its benchmark rate from 10.75 percent to 8.75 percent in the 12 months to March, signalling to banks that they should reduce loan prices.

Banks, however, were slow to pass on the full rate cuts to borrowers while moving quickly to slash deposit rates.

‘Deposit rates are often short term and banks tend to focus on transactional deposits, allowing banks to lower them almost instantly as the central bank slashed the CBR rate,’ said Ms Ndanu.

‘On the other hand, yields on loans fell at a slower pace, likely due to the high cost of legacy fixed deposits booked during the high-interest-rate environment, operational cost considerations, sticky NPLs – still in the double digits – among other considerations,’ she added.

Asset quality

Non-performing loans stood at 15.6 percent of the total loan book, equivalent to Sh694.6 billion, at the end of March compared with 17.4 percent, or Sh717.4 billion, a year earlier.

The improved quality of loan book follows aggressive debt collection efforts, including the auction of collateral by banks, the conclusion of court cases involving lenders and large corporates over defaulted loans, and decisions by lenders to write off debts they did not expect to recover.

Customer savings with banks rose 13.6 percent, or Sh782 billion, to Sh6.51 trillion, outpacing growth in lending. This suggests banks invested more in lending to the government during the review period than in extending credit to the private sector.

Small banks recorded faster growth than their larger rivals, with some institutions that had previously been loss-making returning to profitability.

UBA Kenya moved from a loss of Sh12.3 million to a pre-tax profit of Sh120.9 million, while CIB Kenya turned a Sh155.8 million loss into a profit of Sh160.1 million.

Mixed fortunes

Among the large banks, results were mixed, with Standard Chartered Bank Kenya and Absa Bank Kenya recording profit declines.

StanChart posted a 30.6 percent drop in pre-tax profit to Sh4.22 billion from Sh6.08 billion, which was attributed to interest expenses declining slowly.

Absa reported a 17.5 percent decline in profit due to higher expenses, particularly staff costs, following one-off payments of Sh717 million to employees who took voluntary early retirement during the first quarter.

KCB Bank Kenya remained the country’s most profitable lender, posting a profit of Sh17.62 billion after a 21.4 percent increase.

Equity Bank Kenya reported a profit of Sh11.9 billion, underlining the contribution of its parent firm’s regional subsidiaries, whose earnings helped the group surpass KCB in overall profitability.

The first-quarter growth signals another strong year for banks, which posted a record pre-tax profit of Sh311.8 billion last year despite reporting flat earnings in the first three months of 2025 compared with 2024.

Rising inflation could, however, cast a shadow over the sector as households prioritise basic needs over loan repayments, potentially pushing non-performing loans higher.

Notably, between the end of December 2025 and March this year, the ratio of non-performing loans rose marginally to 15.6 percent from 15.4 percent.

‘This was due to a higher increase in gross NPLs of 3.4 percent and an increase in gross loans of 1.9 percent,’ said the CBK.

Kenya’s digital lending industry is learning, sometimes painfully, that failures in data protection compliance now come with a significant price tag. As regulators intensify enforcement, unlawful handling of personal data is proving to be one of the most expensive risks facing mobile-based lenders.

The sector, which has transformed access to credit through smartphone apps and digital platforms, relies heavily on personal data. Identity details, contact information, and behavioural data sit at the core of digital credit scoring and debt recovery.

Regulators are increasingly clear that the convenience of digital lending does not reduce the obligation to process that data lawfully, accurately and transparently.

This message was reiterated in a recent decision by the Office of the Data Protection Commissioner, where unlawful processing of personal data resulted in a significant monetary compensation award to an affected individual.

While the decision turned on its own facts, the amount awarded sent a strong signal across the industry. Data protection breaches are no longer attracting nominal penalties. They are now resulting in substantial financial consequences.

One recurring concern for regulators is the failure by digital lenders to verify identity properly before extending credit or initiating recovery. In an ecosystem vulnerable to fraud and impersonation, inaccurate data can quickly escalate into serious rights violations.

When an individual is wrongly linked to a loan, persistent calls and messages demanding repayment are not simply customer service errors. They can amount to unlawful processing and harassment.

The Data Protection Act places a clear obligation on data controllers to ensure that personal data is accurate and up to date, and to stop processing where errors are identified.

Regulators have stressed that once a lender is put on notice that data may be incorrect, whether through claims of identity theft or mistaken attribution, it must act promptly. Continuing recovery efforts in such circumstances only deepens regulatory exposure and increases the risk of financial liability.

Equally troubling to regulators is how personal data is shared during debt collection. Disclosure of an individual’s information to third parties, including external debt collectors or other contacts, requires a lawful basis.

Where such disclosures occur without proper verification or safeguards, especially involving people who are not borrowers, they represent serious breaches of data protection law.

These concerns intersect directly with the Central Bank of Kenya’s Digital Credit Providers Regulations, which prohibit abusive, oppressive, or harassing recovery practices.

The regulations were introduced to restore discipline to a sector long criticised for aggressive collection tactics, misuse of contact lists and weak governance. Under the current regulatory approach, data protection failures are increasingly treated as indicators of wider compliance breakdowns.

In an industry built on speed and scale, the emerging regulatory reality demands caution. The era of rapid growth without robust safeguards in digital lending appears to be coming to an end.

The recent ODPC decision also highlights another costly risk for digital lenders: how they conduct themselves during regulatory investigations.

Attempts to deny holding personal data, minimise the extent of processing or provide inconsistent explanations have been cited by regulators as aggravating factors. Such conduct can influence the severity of penalties and expose senior officers to personal accountability.

This reflects a broader shift in enforcement. Regulators are now willing to look beyond corporate entities and examine the role of directors and senior management, particularly where there is a lack of candour or cooperation. Compliance failures are no longer viewed purely as operational issues. They are governance failures with financial and personal consequences.

The regulatory landscape around digital lending is also tightening. Licensing reforms, enhanced supervision by the Central Bank and closer coordination with the data protection regulator point to a more assertive enforcement posture.

Digital lenders are expected to invest in robust identity verification systems, clear escalation processes for disputed debts, and strict oversight of third-party collection agents.

For consumers, this shift offers reassurance. Hefty compensation awards demonstrate that unlawful data practices are no longer treated lightly. Complaints about wrongful pursuit, harassment, and misuse of personal information are increasingly translating into tangible remedies.

For digital lenders, the lesson is clear. Data protection compliance is no longer a technical afterthought or a legal formality. It is a core operational obligation with direct financial consequences. As enforcement activity gathers pace, the cost of getting it wrong is overtaking the cost of getting it right.

Kenya Railways Corporation (KRC) has defended the Sh12 billion Riruta-Ngong commuter metre gauge railway project, arguing that it complied with all legal and procedural requirements.

In submissions filed in court, KRC urged the court to dismiss a petition filed by Busia Senator Okiya Omtatah and the Karen Langata District Association, saying the project was implemented within the law and subjected to oversight at every stage.

‘At every stage, the process was subject to audit, oversight and statutory controls. There is therefore no evidential basis for the allegation that the projects are hidden, irregular, or outside constitutional governance structures,’ KRC said.

The Riruta-Ngong MGR line was commissioned in December 2023. Mr Omtatah and the association contend that funds from the Railway Development Levy Fund (RDLF) were used unconstitutionally to finance the construction and implementation of the project.

KRC, however, argued that the petition is based on a legal framework that has since been amended, adding that the changes addressed the concerns raised by the petitioners.

‘Furthermore, the Riruta-Ngong Commuter Meter Gauge Project is a railway infrastructure project and thus, the implementation and construction of such a project using funds from RDLF goes hand-in-glove with the purposes of the RDLF as outlined under Section 8(3)(a)-(c) of the Miscellaneous Fees and Levies (Amendment) Act, 2026,’ KRC said.

Mr Omtatah, however, maintained that the project commenced long before the amendment came into force on March 27, 2026.

At the time, he said, Section 8(3) of the principal Act restricted the use of the fund to the construction and operation of the Standard Gauge Railway network.

The senator further argued that the 2026 amendment does not contain any express retrospective provision validating expenditure incurred before its enactment.

‘Consequently, any application of RDLF funds towards the project was unconstitutional, unlawful and without statutory authority,’ he said.

Mr Omtatah also argued that the project was undertaken in blatant violation of laws governing public investment in Kenya.

He submitted that no feasibility study was conducted for the railway line as required under the relevant regulations. He further argued that the government’s failure to produce a pre-feasibility study, despite a direct court order, demonstrates either that no such study exists or that the project proceeded in fundamental breach of mandatory public investment requirements.

Mr Omtatah said a feasibility study for a mega project is not optional.

‘It is a mandatory statutory condition precedent to project approval, financing, procurement and budgetary allocation. The public investment management framework expressly prohibits an accounting officer from seeking approval or budgetary allocation for a public project unless the prescribed feasibility requirement have first been complied with and approved in accordance with the law,’ he said.

The recent fire tragedy at Utumishi Secondary School in Gilgil, which claimed the lives of 16 learners and left several others seriously injured, has once again reopened a painful national conversation. It forces us to pose a difficult question: should Kenya continue maintaining boarding schools in their current form, or is it time to abolish or fundamentally re-evaluate their usefulness?

Boarding schools were shaped in the pre-independence era and later expanded as instruments of access to education, national integration, and academic efficiency.

Over time, they evolved beyond academic institutions into structured environments for discipline, identity formation, and social mobility. For many learners, they provided stability, moral grounding, and exposure that may not have been equally available in home settings.

However, the current crisis is not necessarily that boarding schools are inherently obsolete. It is that the ecosystem supporting them has significantly weakened.

Several structural challenges are now evident.

First, student welfare systems have not evolved at the same pace as changing population pressures and modern social dynamics. Overcrowding, under-staffing, and inadequate psychosocial support have reduced supervision and care within the institutions.

Second, safety infrastructure and enforcement remain erratic. Fire preparedness, emergency response systems, and general infrastructure maintenance in many schools fall below acceptable standards, exposing learners to avoidable risks.

Third, social behaviour patterns among learners have changed. Exposure to digital platforms, peer influence, and evolving family structures have created new realities that older disciplinary models are struggling to manage effectively.

Fourth, parental engagement has, in some cases, been unintentionally weakened by the boarding system itself, creating gaps in continuous moral guidance and emotional support.

Something has indeed shifted. Increasingly, some education institutions are grappling with rising cases of indiscipline, including drug abuse, coordinated unrest, and disruptive behaviour often influenced by a few learners. At the same time, traditional disciplinary frameworks are no longer applied with the same consistency or authority they once were.

This shift is partly a consequence of history. Past abuses of disciplinary authority by some educators led to serious outcomes, including injury and loss of life.

These incidents necessitated stronger safeguards under the law. However, the unintended effect has also been a weakening of structured discipline in some schools, leaving administrators constrained in enforcing order effectively.

Parents have also become central to this evolving dynamic. While their role in safeguarding children is essential, some have increasingly resisted firm corrective measures, thereby weakening the authority structures within schools.

It is, therefore, imperative that government urgently implements all existing audit reports and safety recommendations on schools..

Where institutions fail to meet minimum thresholds, decisive interventions, including temporary closure for inspection, correction, and certification, should be considered.

Beyond physical infrastructure, Kenya must now embrace technology-driven disaster preparedness systems as a core part of school safety.

Modern institutions should be equipped with smart fire detection and alarm systems capable of automatically triggering real-time alerts to nearby fire stations, police units, and emergency response teams using GPS-enabled location systems.

In addition, schools should adopt structured digital safety and intelligence systems that allow early detection of risks such as bullying, drug abuse, radical behaviour shifts, or planned unrest.

These systems, however, must be carefully designed to protect learners’ rights and ensure that whistleblowers are never victimised or exposed. A safe reporting culture-supported by anonymous reporting tools and independent safeguarding officers-should be institutionalized in every school.

Equally urgent is the need to re-audit disciplinary frameworks to ensure they align strictly with the Constitution and legal safeguards, while still restoring order, accountability, and learner discipline.

The current funding model is under strain, particularly under the Competency-Based Curriculum (CBC). Junior Secondary Schools (JSS), in particular, continue to face serious challenges in infrastructure, staffing, and learning materials, exposing systemic capacity gaps that must be urgently addressed.

Ultimately, political leadership, school boards, and education authorities must treat safety, infrastructure investment, technology integration, and institutional accountability not as secondary concerns but as central pillars of education reform.

Kenya now faces a defining policy choice: to retain, abolish, or radically reform boarding schools. But beyond the debate, one truth remains clear-the system must be urgently re-evaluated and rebuilt to restore safety, discipline, and purpose in equal measure.

The question is no longer whether boarding schools have served Kenya well in the past. The question is whether they are still safe, sustainable, and fit for the future of Kenya’s children today.

Most recent data from the Insurance Regulatory Authority (IRA) shows that in the last quarter of 2025, the insurance industry paid more than Sh80 billion in claims in just four months, highlighting the critical role it plays in supporting individuals and businesses in times of loss.

Within the same review period, the regulator recorded that 532 complaints were registered compared to 423 in Q2 2025. Of these, 82 percent were related to general insurance, while 18 percent were made against long-term insurers.

However, behind these numbers lies an industry operating in an increasingly complex environment, shaped by rising customer expectations, evolving risks, and operational pressures. Among these issues, two stand out: delayed claims and increased fraudulent activities, especially cyberfraud.

While the industry’s importance is clear from the scale of its payouts, the claims environment itself is becoming more demanding due to increased climate-related disasters, geopolitical disruptions affecting global supply chains, and the sharp rise in cyber incidents, among others.

All these continue to make claims more complex to assess and resolve. The industry must, therefore, acknowledge that these pressures are reshaping the landscape, creating an urgent need to rethink claims management.

Fraud remains one of the most persistent and expensive challenges. According to the Insurance Fraud Investigation Unit, 184 cases were recorded in 2024 and about 57 cases in Q3 of 2025. While these figures may appear insignificant, their impact is substantial, with fraud estimated to account for 10-15 percent of total claims costs in the motor and medical segments alone.

According to the Communications Authority of Kenya, at least 4.56 billion cyberthreats targeting local organisations were recorded in Q3 2025, a 441.27 percent rise.

These pressures are directly impacting how claims are handled, from assessment timelines to settlement speeds, and are forcing the industry to rethink traditional approaches to claims management.

Addressing these challenges requires more than incremental adjustments. It calls for a fundamental shift in how the industry operates and embraces emerging technologies such as artificial intelligence, predictive analytics, satellite imagery, and digital claims platforms to improve efficiency.

These technologies can help process claims faster, enhance fraud detection accuracy, and improve transparency for policyholders.

While this shift in mindset is already underway, as reflected in conversations at the recent Inaugural Minet Kenya Claims Conference 2026, there is a need for more platforms and greater involvement of industry leaders, innovators, and professionals to discuss the future of claims, customer-centric practices, and sustainable insurance solutions.

Claims management remains a people-centred function, often involving individuals and businesses recovering from loss. Therefore, this is not just a call for efficiency or an opportunity to reduce operational costs. It is a call to strengthen the industry and deliver on its core promise: providing timely, fair, and transparent support when it is needed most.

Today, paper is no longer a mandatory part of the claims process. The speed of settlement, ease of processing information, and simplicity of lodging and paying out claims are now of utmost importance.

Adopting AI-powered solutions, for instance, can automate key steps such as documentation, verification, and assessment, significantly reducing processing times from weeks to days or even hours.

For customers, this translates into quicker settlements and a smoother experience. For insurers, it means improved efficiency, better resource allocation, and stronger operational performance.

Equally important is AI’s role in fraud detection. By analysing large volumes of data, AI systems can identify patterns, anomalies, and inconsistencies that may not be immediately visible through traditional methods.

This allows insurers to flag suspicious claims earlier, reducing losses and ensuring that genuine claims are prioritised and paid promptly.

However, while AI brings powerful capabilities, it is not a replacement for human judgment. Claims management remains fundamentally people-centred, involving individuals and businesses at moments of loss and uncertainty. As Oromo noted, it is a function that requires empathy, fairness, and careful decision-making.

The most effective approach, therefore, is not to choose between technology and people, but to combine them. AI can handle data-intensive and repetitive tasks, while human professionals focus on complex cases, nuanced decision-making, and customer engagement.

Together, this creates a more balanced, responsive, and effective claims process.

Twenty-five-year-old Beverly Moraa has attended five orchestral performances so far, and she is not about to stop.

Her first encounter with orchestral music came while she was still in high school.

‘I took music classes in high school, and we were encouraged to attend Nairobi Orchestra’s performances to get a feel of classical music,’ she says. ‘So I attended one, and they were playing Bach. It was so beautiful.’

What stayed with her was not just the music, but how it made her feel.

‘No words were being sung, and you could hear the individual instruments and how they all came together in one seamless harmony,’ she says. ‘As I listened, I was feeling and interpreting the emotions coming through in my own way. I was also trying to understand what the composer felt as they created the piece.’

Pushing back against stereotypes

This openness to interpretation, she believes, is where the beauty of the orchestra lies.

‘It’s like art,’ she says. ‘There might be an entire crowd around you listening to the same performance, but everyone is feeling something different.’

‘The last one I attended had a good balance,’ she says. ‘There were many young people who appeared to be in their 20s, and there was even a class of students brought by their teacher.’

Looking forward to upcoming performances, Beverly pushes back against stereotypes often associated with orchestral music.

‘Have you seen the ticket prices? I don’t think it’s only for the rich. I am usually there with very regular people, and there’s no dress code either,’ she says. ‘Yes, everyone looks good, but they’re mostly casually dressed.’

These changing audiences are not merely a perception.

Affordable sell-out concerts

David Ralak, concertmaster at the Nairobi Orchestra, says interest in orchestral music has grown significantly over the years.

‘There’s so much going on now,’ he says. ‘The rate at which concerts are selling out, and classical musicians and ensembles are emerging, is something I never expected.’

According to Ralak, the transformation has been particularly visible in who attends performances.

‘Until the 2000s, it was mostly foreigners and expats, but when a few brave Kenyans took up these foreign classical instruments, others were encouraged to follow,’ he says. ‘Social media has also made everything more accessible, including information about upcoming events.’

Today, he says, audiences at Nairobi Orchestra performances are roughly 80 percent Kenyan, with young people making up a significant share.

Affordability has also helped broaden the audience.

‘There are exclusive orchestral performances that are largely meant to fundraise, but on average, tickets range between Sh1,000 and Sh3,000,’ he says. ‘It’s actually rare for them to even reach Sh3,000, and that’s intentional to make this accessible to as many people as possible.’

For Beverly, the appeal goes beyond accessibility.

‘I attend a lot of music events, but I only go to the orchestra when I am looking for something more peaceful,’ she says. ‘I find it very grounding. If I go when my mind is cluttered or after a long week, I leave feeling lighter and with my thoughts flowing better.’

She mostly attends alone, occasionally bringing friends along. While one promised to return, another decided it simply was not for them.

‘Orchestral music is pretty mellow,’ she says. ‘I think most people who are drawn to the orchestra are those who appreciate music as more than just entertainment. They see it as art, something to interpret, connect with, and feel deeply.’

Regardless of who accompanies her, once the performance begins, everything else disappears.

‘Honestly, I forget who I’m there with,’ she says with a laugh. ‘I just lock in, and the rest of the world disappears until it’s over.’

Professionalism and inclusivity

While Beverly is drawn to the orchestra’s emotional depth, 27-year-old David Macharia finds himself captivated by something entirely different.

A comedian by profession, David first attended an orchestral performance out of curiosity.

‘When I was in school, we had a band whose setup was like that of the orchestra,’ he says. ‘Every school term, they would hold a concert to showcase what they had been working on, so when I got an invite to an orchestral performance, it felt familiar, and I decided to go.’

What continues to impress him is the discipline behind the music.

‘For most other forms of entertainment, including stand-up comedy, there’s usually more room for individual expression,’ he says. ‘But with the orchestra, they move as one unit. You can tell they’ve spent a lot of time putting the performance together.

There are many instruments, not all playing the same thing necessarily, but somehow it all comes together seamlessly.’

Over time, he has also come to appreciate the brief introductions that often precede each piece.

‘They might tell you about the composer, when and how it was composed, or even where it is often played,’ he says. ‘Initially, I never cared for those backstories. In my head, I’d be counting down the seconds till the actual music started, but these days, I find myself more curious about them.’

One aspect of orchestral performances he particularly enjoys is the diversity of people they attract.

‘Sometimes I find myself seated next to an elderly couple well beyond their 70s on one side, and a parent with a child under five years old on the other,’ he says.

‘Not many events can accommodate such a wide range of people, and even beyond the music, that adds a wholesome feel to the experience.’

Though orchestral events can appear formal, David believes much of the intimidation people feel is self-imposed.

‘The last one I attended, I was in ripped jeans,’ he says. ‘I can see how people can feel intimidated, but that’s because they assume others are paying attention to them. But the truth is, nobody really cares what you are doing. Everyone’s too busy thinking about themselves.’

‘It’s food for the soul’

For those on stage, however, creating that seamless experience requires years of dedication.

Now 33, Ralak began his violin journey in high school after a music teacher introduced him to the instrument. ‘I had played the clarinet, the saxophone, and a little bit of the trumpet, but when I picked up the violin, I was hooked,’ he says. ‘Naturally, I dropped all the other instruments.’

Part of the attraction, he says, was the challenge.

‘I pretty much had to figure out how to play it on my own, and I think I became obsessed with the complexity and difficulty of that process,’ he says.

‘There’s something about its sound that is very close to the human voice. It’s just like someone speaking, but without words, and that pulled me in from the very first note I ever played.’

When it comes to orchestral performance, Ralak says the nerves never entirely disappear.

‘Orchestra has to be the strangest, most unique type of fine art,’ he says. ‘It puts together 70 to 100, possibly even more, musicians on one stage, and has them trying to come up with one outcome without any chaos.’

Achieving that outcome requires extraordinary preparation.

‘For a single performance, it takes us about 10 weeks of rehearsals,’ he says. ‘But the bulk of the work is really done in the years musicians spend practising their instruments because by the time you join an orchestra, you’re expected to be highly skilled.’

Once the conductor raises the baton, the real work begins.

‘As musicians, we have to multitask between watching the conductor, the audience, and our music sheets,’ he says. ‘At the same time, we also have to listen not only to our own instruments, but to every other instrument as well. There’s a lot of communication going on that the audience never notices.’

What he hopes audiences leave with, however, is not an appreciation of the technical difficulty but of the experience itself.

‘It’s food for the soul,’ he says simply. ‘The audience should leave with full hearts and a sense of being refreshed.’

And increasingly, those audiences are made up of young Kenyans discovering an art form that was once considered distant, exclusive and foreign.

‘A lot of people actually enjoy this music. They love movie soundtracks without realising that it is classical music,’ says Ralak. ‘And while the recorded version is nice, a live orchestra engages both hearing and sight. You get to see how the sound is produced and feel things that are lost in a recording. It’s beautiful and heavenly.’

Electric motorcycle company Spiro has raised $215 million (Sh27.8 billion) in fresh funding to expand its battery-swapping network, local manufacturing and enter new African markets.

The equity funding round, where a firm raises capital by selling ownership shares, was led by Impact Fund Denmark, Denmark’s development finance institution, alongside Spiro’s Dubai-based parent company, Equitane.

Spiro said it would expand its battery-swapping infrastructure, strengthen its industrial and assembly footprint, accelerate technology development and support expansion into the Democratic Republic of Congo (DRC) and Ethiopia.

It comes just days after the company announced the acquisition of UK engineering and design firm Coexlion, as it seeks to boost its motorbike development and localise design for African markets.

The raise is also one of the largest recent capital injections into the region’s e-mobility sector as venture capitalists scramble to invest in companies working to reduce fuel import dependence and cut transport emissions.

‘Supported by our global pool of investors, we are entering our next growth chapter to deliver clean, cost-effective energy and transport alternatives to millions of riders across the continent,’ Gagan Gupta, Spiro’s founder and chairman of Equitane, said in a statement shared with the Business Daily.

Founded in 2022, Spiro is a subsidiary of Equitane, an investment vehicle, and has its operational headquarters in Nairobi. The company operates in Kenya, Uganda, Rwanda, Nigeria, Togo, Benin and Cameroon, where the majority of its electric motorcycles are used by commercial motorcycle taxi operators, popularly known as boda bodas.

Spiro assembles its motorcycles in Kenya, Rwanda and Uganda from knockdown kits imported from China, with some components sourced from India.

Its Nairobi assembly plant has an annual production capacity of up to 50,000 motorcycles. The firm also has a battery recycling facility in Nigeria.

With the new funding, Spiro plans to expand local production capabilities across vehicle manufacturing, battery-swapping infrastructure, maintenance services and technology development.

Last week, Spiro announced the acquisition of Coexlion as part of plans to establish its first African research and development (RandD) centre in Nairobi.

RandD centres are innovation hubs where engineers, scientists and researchers develop new technologies, build prototypes and improve software and hardware products for commercial use.

Spiro said the acquisition boosts its ability to design, develop and manufacture electric motorcycles tailored to African road conditions and customer requirements, while helping it build its technology, engineering and manufacturing capabilities in-house.

The company says it has deployed more than 100,000 electric motorcycles across Africa and operates over 2,500 battery-swapping stations, making it the continent’s largest e-motorbike firm.

‘We see potential for significant commercial growth in Spiro and electric mobility across Africa, as well as measurable climate impact,’ said Lars Bo Bertram, Chief Executive of Impact Fund Denmark.

The latest fundraising adds to Spiro’s string of major capital raises over the past year.

In February, the firm secured $50 million (Sh6.5 billion) in debt financing from the African Export-Import Bank (Afreximbank), climate-focused financier Nithio and the Africa Go Green Fund.

Last October, the company also announced a $100 million (Sh12.9 billion) venture funding round led by the Fund for Export Development in Africa, the impact investment arm of Afreximbank.

The latest investment round brings to $502 million (Sh65 billion) the total funding the company has received to date, according to data from the global business portal Crunchbase.

There has been increased investor appetite for electric mobility ventures like Spiro, Arc Ride, Roam and BasiGo in recent months.

These firms seek to reduce fuel import dependence, cut transport emissions and develop local manufacturing industries around emerging clean energy technologies.

Investors are drawn to Kenya’s high motorcycle density, a power grid largely supplied by renewables and a policy environment that has signalled support for electric mobility.

There is a proverb often shared across our continent: ‘However long the night, the dawn will break.’

But there is a quieter truth beneath it-those who prepare for the night weather it better than those who simply wait for dawn. Today, Africa finds itself in another long night.

The ongoing Iran crisis and disruption through the Strait of Hormuz-one of the world’s most critical energy chokepoints-has triggered one of the largest energy supply shocks in modern history.

The strait normally carries roughly 20 percent of global oil supply and nearly 25 percent of global seaborne oil trade. Around 80 percent of these flows are destined for Asian markets, with China, India, Japan and South Korea among the largest importers.

In recent weeks, oil prices have surged past $110 per barrel, with peaks reaching as high as $126 during the height of the disruption. For Africa, this is not just a geopolitical event. It is a direct economic shock.

Across the continent, rising oil prices are feeding into transport costs, food inflation, and currency pressures.

In Kenya, the Central Bank projects inflation could rise to 6.2 percent in the coming months-above its 5 percent midpoint target-driven largely by higher fuel prices.

We are already seeing second-order effects. Transport operators are adjusting fares upward, supply chains are tightening and households are absorbing the cost of a crisis they did not create. This is not new. It is a pattern. And that is precisely the point.

What Africa has always needed is patient capital-and this is much clearer today than ever before. Because the challenge before us is not just volatility. It is structural exposure. Over 40 African countries are net oil importers, meaning external shocks translate almost immediately into domestic instability.

When capital is short-term, risk-averse, and priced for quick returns, it retreats at precisely the moment it is most needed. Businesses stall. Investments pause. Growth becomes fragile.

Patient capital does the opposite, it stays. It absorbs shocks, provides continuity, enables businesses to continue investing even when input costs rise and it allows governments and institutions to think beyond the immediate crisis and invest in long-term resilience.

We have seen this model work-decisively-elsewhere. Singapore offers one of the clearest examples. Through Temasek Holdings, which manages over $300 billion in assets, the country has consistently deployed long-term, state-backed capital into strategic sectors-from energy to logistics to technology. During global shocks, these institutions do not withdraw; they stabilize.

Similarly, Canada’s pension funds, including CPP Investments, deploy over $500 billion globally with investment horizons measured in decades. They invest heavily in infrastructure and energy systems, often taking counter-cyclical positions when markets are under stress.

These are not just funds. They are shock absorbers. Closer to home, Kenya’s newly established National Infrastructure Fund (NIF) signals a shift toward this same philosophy.

At its core, the NIF represents an opportunity to move from reactive policy to proactive resilience. Because if oil prices can spike above $110 per barrel due to disruptions thousands of kilometres away, then the real question is not how we respond-but how we reduce our exposure. This is where the NIF becomes critical.

Strategically deployed, it can channel long-term capital into renewable energy, reducing dependence on imported fuel. And if we get this right-if we align institutions like the NIF with a broader ecosystem of long-term, resilient capital-then moments like this will no longer define us.

For the NIF to succeed, it must embody these same principles. Across Africa, the infrastructure financing gap exceeds $100 billion annually.

At the same time, the cost of capital remains among the highest globally. Bridging this gap will require more than traditional financing models. It will require capital that is willing to wait, capital that is comfortable with complexity and one that measures success not just in quarterly returns, but in long-term transformation.

The Iran crisis is a reminder-perhaps a costly one-that Africa cannot afford to build its future on short-term foundations. We cannot control global oil prices. We cannot control geopolitical tensions.

As the proverb reminds us, dawn will come. The question is whether we will have built enough through the night to meet it.

But we can control how we prepare. Patient capital is not a luxury. It is a necessity. And we will be ready.