The Competition Authority of Kenya (CAK) has fined MOGO, an asset finance fintech, KES 10.8 million for allegedly altering loan terms, including switching from Kenyan shillings to dollars midway through the loan period. It has also been ordered to refund three customers KES344,939.
The CAK said the decision followed complaints from four customers between May 2023 and April 2024. This marks the first time a Kenyan fintech has been penalised for breaching consumer rights.
The CAK said the Eleving Group-backed fintech broke local laws by “engaging in false and misleading representation and unconscionable conduct” toward the four customers who filed the complaint.
“The first complainant alleged that they applied for a loan in June 2022. The facility of KES2.1 million (USD 17,828.16) at the exchange rate of KES117 was payable in 60 monthly instalments at a 2.6% flat interest rate. The complainant accused Mogo of adjusting the terms flat rate and the interest payable was calculated in USD, despite the facility being disbursed in KES,” CAK said.
MOGO’s main products are car financing and short-term logbook loans. It is popular among ride-hailing drivers and motorcycle operators.
The second complainant took a $2,324 (KES300,000) loan in 2021 but paid more than the contracted amount due to the volatile currency exchange rate in the market. Again, MOGO was accused of changing the loan agreement without the customer’s knowledge.
The regulator said the change in currency exposed the customer to unpredictable repayments due to currency fluctuations. In 2023, the Kenyan shilling lost over 26% of its value, its worst decline since 1993, significantly increasing the cost of dollar-denominated loans.
“The third complainant asserted that Mogo financed 50% (KES. 310,000) of the purchase price of a motor vehicle. However, Mogo calculated the loan installment amounts in USD and required the complainant to pay in KES,” CAK said.
As part of the Friday ruling, the regulator also ordered MOGO to resolve all pending complaints immediately, “refrain from engaging in such conduct in future,” and take staff to a consumer compliance training by 30th August 30, 2025.
CAK’s action will reignite the war against predatory lending, with fintechs and digital lenders accused of saddling low-income earners with debt.
