The Competition Authority of Kenya (CAK) has fined Mogo Kes 10.9 million for false and misleading representations and unconscionable conduct toward its customers.
In a directive, CAK says the decision follows investigations triggered by complaints from four customers who accused the company of altering loan terms, applying fluctuating foreign exchange rates, and overcharging them.
“Mogo has also been directed to; refrain from misrepresenting facts and engaging in unconscionable conduct when dealing with its clients, amicably resolve all pending complaints before the Authority, and resolve future complaints expeditiously.”
Similarly, the watchdog has directed Mogo to refund Kes 344,939 to three customers as reimbursement for excess charges due to currency conversion differences and inflated interest rates.
The authority’s investigation was initiated in May 2023 after customers lodged complaints about discrepancies in loan repayments and interest calculations.
Did you read this?
CAK revealed that one complainant alleged that a loan of Kes 2.1 million disbursed in Kenyan shillings was subjected to a dollar-based repayment plan, causing unpredictable payments.
Similarly, after paying for 20 months, another customer found their outstanding balance had increased beyond expectation, a result of Mogo’s use of the dollar despite disbursing loans in shillings.
The investigation found that Mogo had violated sections of the Competition Act by making misleading representations and unilaterally altering loan terms.
While Mogo initially denied the accusations, they later agreed to settle the matter administratively, committing to pay the fine and resolve all pending and future complaints.
