Category: Business Daily

Betting companies face higher operating costs following plans to introduce a licence fee of up to Sh300,000 for key employees.

The permit fee for foreigners holding the key roles will be Sh300,000, while Kenyans will pay Sh50,000, under the Gambling Control Licensing Regulations, 2026.

Foreign shareholders or directors will pay Sh300,000 for a licence, while the locals will part with Sh100,000. Additionally, there will be an application fee of between Sh10,000 and Sh50,000.

Betting firms will pay the licence fees for their staff, which is expected to significantly drive the cost of business in the multibillion-shilling gambling sector, whose popularity has risen in recent years.

Betting firms currently pay three taxes, besides annual licensing and compliance fees.

Kenya is now pushing to emulate developed economies like the United Kingdom, Malta, and Singapore that compel key personnel at betting firms to have licences.

The Gambling Regulatory Authority of Kenya (GRAK) has not indicated the positions of the personnel who qualify as key employees. However, in developed economies, these include the CEO, the officer in charge of anti-money laundering, and the head of IT.

‘Key gambling employees shall apply for a licence by submitting an application to the Authority in Form 14 set out in the First Schedule.

An application under subregulation (1) shall be accompanied by- (a) the application fee prescribed in the Second Schedule of these Regulations,’ GRAK says in the regulations.

The regulations are currently undergoing public scrutiny as Kenya races to slam the brakes on the runaway betting craze.

Besides the licence, these employees must also submit a certificate of good conduct and a tax compliance certificate from the Kenya Revenue Authority (KRA), allowing GRAK to further vet the staff.

The overall costs of the licence fee for the key staff will add to the high operational costs that betting firms face. The firm have on several occasions decried the heavy taxation, with some closing shops as scores of others battle tax disputes with KRA.

Currently, betting firms pay a 15 percent tax on gross gaming revenue, a corporate tax of 30 percent on profits, and income tax at the rate of 16 percent. They are required to remit the taxes every day by 1 am.

Several firms have exited the Kenyan market in the past five years, citing the high taxation that they alleged significantly hit their businesses.

Betsafe exited the local market in May last year, becoming the latest to close shop after the high-profile exits of Betin and SportPesa in 2020.

The government has, in the past few years, been scrambling to halt the betting craze in Kenya, albeit with limited success.

A high rate of unemployment and the quest to make quick cash are behind the betting craze as more Kenyans turn to gambling as a source of income.

A report by the Central Bank of Kenya shows that Kenyans spent an average of Sh1,825 on betting in 2024, with the country being home to the highest number of youthful gamblers on the continent, ahead of bigger economies like Nigeria and South Africa.

When the war in Iran broke out, global equities markets were hit by selloffs as investors fled to the safety of dollar holdings amid fears of rising inflation and economic recession.

This stopped the rally at the Nairobi Securities Exchange (NSE), as foreigners sold shares worth a net of Sh4.3 billion in March, largely on large blue chips that have high exposure to international investors.

Local institutions were also offloading equities to keep a liquid position in order to take advantage of potentially higher fixed income returns if higher inflation pushes the Central Bank of Kenya to raise interest rates.

The result has been a sharp contrast in the performance of the bourse before and after the war started on February 28. In the first two months of the year, the bourse recorded a 15.3 percent growth in investor wealth, equivalent to an increase of Sh453.5 billion to Sh3.41 trillion.

The subsequent two months have seen the market add just 0.5 percent or Sh17.3 billion in market capitalisation, the measure of investor wealth.

The slower growth post February is despite the NSE bringing on board a new listing of the Kenya Pipeline Company (KPC) on March 11, which has added Sh167.9 billion in valuation to the bourse.

Excluding the KPC entry, the market would have shed 4.4 percent or Sh150.63 billion since the Iran war, showing the extent of the dips among the counters that were already in the market.

Safaricom has accounted for the largest valuation decline since the end of February at Sh88.1 billion or 6.9 percent to Sh1.19 trillion, followed by KCB Group at Sh39.4 billion or 15.3 percent to Sh218.5 billion.

As the bourse’s largest and most liquid company, Safaricom is heavily traded by foreign investors, with its movement also influencing the general market performance due to its heavy weight on the indices.

Artificial intelligence (AI) is increasingly shaping how economies function, influencing everything from how credit is assessed to how services are delivered.

Yet for Africa, the question is not simply how quickly these technologies are adopted, but whether they are built to understand the realities they are meant to serve.

At the heart of AI lies data. The performance of any system depends on the quality, diversity and relevance of the datasets on which it is trained. And it is precisely here that Africa faces a structural disadvantage.

Despite accounting for nearly 18 percent of the world’s population, African data remains significantly under-represented in many global datasets.

African languages, identity systems and economic behaviours are often missing or poorly captured. As a result, systems developed elsewhere frequently struggle when deployed across African markets, not because the technology is inadequate, but because the context it relies on is incomplete. This gap becomes particularly evident in identity verification.

Across many African countries, naming conventions do not follow rigid formats. Individuals may use different combinations of names across official records, academic certificates and employment histories. What is entirely normal in local contexts can easily be flagged as inconsistency or even risk by systems trained on Western data structures.

A similar challenge arises with identity documents. Kenya alone uses a range of identification formats, from national identity cards to passports and emerging digital credentials.

Systems designed around European or North American documentation often fail to interpret these variations accurately, creating friction where none should exist.

Employment data presents an even more complex picture. In many African economies, a significant portion of work occurs outside formal payroll systems.

Individuals move between contract roles, entrepreneurial ventures and informal employment, creating career paths that are dynamic but difficult for traditional data models to capture. When such realities are not reflected in training datasets, automated systems struggle to assess individuals fairly and accurately. The issue, therefore, is not technological capability. It is dataset relevance.

Kenya offers a useful illustration of both the opportunity and the challenge.

The country has developed one of the most dynamic digital ecosystems on the continent, supported by expanding internet access and a globally recognised mobile money platform. Yet much of the data generated within this ecosystem continues to be stored and processed outside the continent.

If the continent is to build AI systems that truly serve its people and markets, it must invest deliberately in developing its own datasets and strengthening its digital infrastructure.

Because ultimately, AI does not succeed in abstraction. It succeeds when it reflects reality. And for Africa’s digital future, that reality must be built on African data.

The High Court has ordered State-owned Kenya Electricity Transmission Company (Ketraco) to pay Sh220 million to a French contractor over the stalled Loiyangalani-Suswa wind power transmission line project.

At the same time, the court rejected the company, Enterprise Generale Malta Forest S.A.S’s claim for Sh500 million compensation in idle time and prolongation costs, ruling that the contractor failed to strictly prove the losses despite citing delays, site disruptions, and non-payment.

The court found that the contractor was entitled to payment for certified works despite failing to fully meet agreed performance targets, marking a significant position in commercial law on partial performance.

The dispute stems from the construction of the 400kV Loiyangalani-Suswa transmission line, a critical project designed to evacuate power from the Lake Turkana Wind Power plant in Marsabit County to the national grid.

Ketraco awarded engineering, procurement, and construction contract to Spain’s Isolux Ingenieria S.A in December 2011, which later, in January 2016, subcontracted part of the foundation works to French contractor, Enterprise Generale Malta Forest S.A.S.

Trouble began when Isolux ran into financial distress, slowing the project and delaying payments to subcontractors.

In January 2017, Ketraco entered a direct payment agreement with the subcontractor and Isolux to accelerate construction by funding additional work teams.

Under the arrangement, Enterprise Generale Malta Forest S.A.S mobilised four additional civil works teams, deployed equipment and personnel on site, and executed foundation works along the transmission line corridor.

It invoiced Ketraco more than Sh321 million. The State agency paid about Sh72.8 million but declined to settle the balance, disputing the performance and certification of invoices.

The contractor sued in 2018, seeking over Sh248 million for certified works and an additional Sh342 million for losses linked to delays, idle time, and disruption.

A second suit filed in 2020 sought an additional Sh179.19 million, pushing the total claim well beyond Sh700 million, with the contractor citing alleged misrepresentation and prolonged site costs after remaining on site awaiting payment.

Ketraco denied liability, arguing it was not a party to the subcontract and that the direct payment agreement did not create a full contractual relationship. It also counterclaimed for Sh74.3 million, alleging the contractor failed to mobilise teams as agreed.

But in the ruling, the court held that the direct payment agreement created a ‘limited and specific contractual relationship’ between Ketraco and the contractor, enforceable within its terms.

‘The defendant cannot therefore run away from the obligations it was bound to perform under the said agreement,’ Justice Njoki Mwangi stated, in a ruling that clarifies how far liability extends in complex infrastructure contracts.

The court found that while the contractor did not fully achieve output targets, evidence showed that part of the work was executed and certified. Payments already made by Ketraco supported that conclusion.

‘The plaintiff’s performance under the Direct Payment Agreement was partial, and that the failure to achieve full performance arose from a combination of factors attributable to both parties, each contributing to the failure to achieve full performance,’ said the court.

Crucially, the court affirmed that certified work must be paid for, even where performance is incomplete, provided contractual conditions are met.

After reviewing invoices and payment records, the court awarded Sh220.7 million tied to certified and comparable invoices, finding them sufficiently proved on a balance of probabilities.

However, the court rejected claims exceeding Sh500 million for idle time, disruption, and prolonged costs, citing the lack of strict proof required for special damages.

‘There is insufficient specific proof quantifying idle time losses,’ the court said, adding that the contractor failed to demonstrate presence on site and actual losses incurred.

The court also dismissed Ketraco’s counterclaim for a refund of mobilisation funds, ruling that partial performance had been established and there was no basis for unjust enrichment.

Further, the court held that the insolvency of Isolux in July 2017 disrupted the project but did not extinguish obligations already accrued under the direct payment agreement.

The court further found that the correspondence cited by the contractor did not amount to enforceable promises capable of creating legitimate expectation.

Ketraco, a State corporation mandated to plan, design, and operate Kenya’s high-voltage electricity transmission network, has overseen key projects linking generation to the national grid.

The Loiyangalani-Suswa line was central to evacuating wind power from northern Kenya, but faced delays linked to financing challenges, land access disputes, and contractor difficulties.

Dividends are becoming a central pillar of wealth creation, beyond share price gains. As listed firms, particularly banks, ramp up shareholder payouts, Make Money explores how investors can position for steady dividend income.

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Make Money, a podcast series hosted by Kepha Muiruri, from Business Daily Africa, unravels ways to be financially savvy. Get practical tips and advice on how to increase your income, build wealth, and achieve financial freedom in Kenya. Whether you’re just starting out or a seasoned investor, we’ve got something for everyone.

Importers are paying higher costs to ship goods as disruptions linked to tensions around the Strait of Hormuz ripple through global shipping routes, forcing vessels to take longer and more expensive alternatives.

Kenya Ships Agents Association chief executive Elijah Mbaru said the crisis has triggered an increase in freight charges, insurance premiums and transit fees- costs that are passed on to importers and ultimately consumers.

‘Any cost that a ship undergoes is transferred to the importer or exporter and eventually to the consumer,’ Mr Mbaru said in a phone interview.

Two months into the conflict, shipping lines, also referred to as ocean carriers, are still grappling with uncertainty, with vessels frequently forced to reroute.

In March, major shipping lines, including Maersk, CMA, CGM and MSC, introduced emergency conflict surcharges of between $20 and $40 for 20-foot containers in reaction to the heightened risks.

A contractor building a paediatric emergency and burns management centre at the Kenyatta National Hospital (KNH) has abandoned the site over a Sh184.3 million debt, leaving the Sh2.9 billion facility undone more than five years after the contractual deadline.

Auditor-General Nancy Gathungu said the outstanding amount includes Sh103 million in certified but unpaid construction claims, Sh69.4 million in accrued interest, and Sh11.9 million owed to the project consultant.

This exposes a breakdown in the execution of the contract and in the management of public projects at one of Kenya’s flagship health infrastructure investments.

It also raises fresh concerns over cost escalation, idle capital, and the risk of further financial exposure if the dispute is not resolved.

‘Furthermore, the loan agreement with the external financiers expired on April 30, 2025, and no evidence was provided to confirm continued commitment to funding the project. In addition, the contractor vacated the site, citing non-payment of certified claims under IPC (Interim Payment Certificate) number 15,’ Ms Gathungu said.

Ms Gathungu had previously raised concerns about the same project in her 2024 audit, warning that delays had resulted in avoidable interest charges that could instead fund medical equipment purchase or doctor recruitment.

Treasury has compounded the uncertainty by cutting the project’s budget by Sh900 million in the current financial year, reducing the allocation from Sh2.1 billion to Sh1.2 billion.

The project was awarded on August 20, 2018, with a contract sum of Sh2,959,511,555. The original completion date of August 20, 2020, was later revised to 2023.

Despite multiple extensions granted at the contractor’s request, the facility was still incomplete as of December 2025, highlighting ongoing implementation issues.

‘The value for money incurred on the construction of the Paediatric Emergency and Burns Management Centre could not be confirmed,” said Ms Gathungu, a standard audit qualification signalling that public expenditure has not resulted in a usable asset.

The 214-bed facility was designed to include 82 general ward beds, 14 intensive care unit (ICU) beds, and six high dependency unit beds for burn patients, as well as 82 general ward beds, 24 ICU beds, and six high dependency beds for paediatric emergencies.

KNH’s paediatric department currently treats an estimated 60,000 to 80,000 children annually across its emergency, inpatient, and outpatient services, while the existing burns unit admits around 1,200 patients per year.

Without the centre, the cases continue to be managed in a general emergency facility, which is not designed for specialised treatment, further complicating infection control and increasing pressure on overstretched resources.

Absa Bank Kenya spent Sh717 million on voluntary separation with 82 of its employees in January this year, joining peers who have rolled out similar schemes amid accelerated use of technology across the banking sector.

The lender revealed that the voluntary exit programme was completed at the end of January 2026, and was not reflected in the staff numbers for the year ended December 2025.

Absa did not explain the reasons for the staff exit scheme, though it came in the wake of continued investment in technology. The lender says it spends between Sh2 billion and Sh3 billion on technology every year.

Many organisations use voluntary exit programmes to cut costs, especially payroll, while others deploy the scheme to refresh talent and realign skills with evolving business needs, particularly as technology reshapes roles.

‘Subsequent to the reporting date, the bank implemented a voluntary exit programme affecting 82 employees, with all exits completed by January 31, 2026, at a total cost of Sh717 million,’ the lender said in its annual report. Absa closed 2025 with 2,217 employees, which was higher compared to 2,167 in the previous year.

The spending on staff benefits rose to Sh13.81 billion in 2025, up from Sh13.53 billion the previous year.

Between 2021 and last year, the lender had added 238 employees. The separation with 82 will mark the first time in five years that the Absa Kenya staff size will be reduced, unless the lender recruits new workers.

‘This restructuring decision was made after 31 December 2025 and therefore qualifies as a non-adjusting event, as it reflects conditions that arose after year-end. In line with International Accounting Standard 10, the bank has disclosed the nature and estimated financial effect of this material event.’

This is the latest voluntary exit programme for Absa, which in 2020 spent Sh1.06 billion on a similar initiative that trimmed its staff size by 161. The lender said then that the decision to cut jobs in senior and junior roles was taken on the back of continued investment in automation.

Absa Bank Kenya has a presence in 38 counties, which it serves with 91 branches and service centres, 204 ATMs, over 8,000 agency outlets, and internet and mobile banking platforms.

Chief finance officer at Absa Bank Kenya, Omari Yusuf, said the investment in technology has helped the lender move more of its staff from back office to front office for services such as advisory, thereby supporting the growth of the business.

In addition, he said, the investment in technology has contributed to a fall in operating expenses, reflecting enhanced efficiency.

In the year ended December 2025, other operating expenses fell by 21 percent to Sh7.35 billion, with Mr Omari attributing this to technology.

‘In there are opportunities from automation. We see the use of robotics for some of our key processes and a move to automate channels to give us the opportunity for savings while delivering convenience and flexibility to our customers,’ said Mr Omari.

The digital investments helped Absa’s cost-to-income ratio-a measure of how much the bank spends to generate one unit of revenue-improve to 36.5 percent in 2025 from 46 percent in the previous year.

The first quarter of 2026 opened with a fresh external shock following the US-Israel war on Iran, adding to global market uncertainty.

Despite this, the Central Bank of Kenya (CBK) has continued its rate-cutting cycle, signalling a supportive environment for investors.

In this episode of the Make Money podcast, Teddy Irungu, Head of Research at Rock Advisors Investment Bank, breaks down the Q1 2026 investing scorecard, examining market resilience, the outlook for the Nairobi Securities Exchange (NSE) and where opportunities still lie.

Make Money, a podcast series hosted by Kepha Muiruri, from Business Daily Africa, unravels ways to be financially savvy. Get practical tips and advice on how to increase your income, build wealth, and achieve financial freedom in Kenya. Whether you’re just starting out or a seasoned investor, we’ve got something for everyone.

The Competition Authority of Kenya (CAK) shielded 150 jobs after imposing tough terms in sale of Regis Runda Academy to South African multinational ADvTECH in September 2025.

As a precondition for the deal, the competition regulator ordered that all skilled and unskilled staff of Regis Runda, now rebranded to Makini School Runda, be retained on employment for at least 12 months after the completion of the transaction.

‘The acquirer, Makini School Limited, shall retain all one hundred and fifty (150) employees of the target comprising of one hundred and forty- five (145) skilled and five (5) unskilled, on terms that are no less favourable than their current terms of employment with the target for a period of at least twelve (12) months following completion of the transaction’ CAK said.

The proprietors of Regis Runda Academy -Peter Burugu and Mary Burugu- sold the school ADvTECH for Sh1.2 billion, marking one of the largest deals in Kenya’s private education market.

The deal marked an expansion in Kenya by ADvTECH, which first acquired a 71 percent stake in Makini Schools from an entrepreneur, Mary Okelo, for nearly Sh1 billion in 2018.

The buyout of Regis raised the number of schools the South African firm owns in the country to 10, including Crawford International, which is also being expanded in response to increased demand.

Following the buyout, Regis rebranded to operate under ADvTECH’s Makini brand.

‘ADvTECH, Africa’s leading private education provider, has expanded its Makini Schools offering in Nairobi, Kenya, by acquiring Regis Runda Academy for Sh1.23 billion (approximately 172 million Rands),’ the multinational said in a statement following the deal.

ADvTECH, which has schools in several countries, including Botswana and South Africa, plans to offer private education conforming to Kenya’s national curriculum and the Cambridge curriculum.

Regis Runda had been charging slightly higher fees than Makini schools located in Nairobi, offering the same Competency Based Curriculum.

The Burugus own various businesses, including Runda Gardens, a gated community, and Kiambu Mall.