Nigerian Investors Drag Ruto’s Name in Battle for CBK’s Payments System

In Summary

• Parents were illegally charged extra fees despite government regulations limiting school payments to uniforms, boarding costs, and lunch.
• KRA’s tax collection from betting firms outperformed all other tax categories, helping boost total revenues even as other key tax heads struggled to meet targets.
• A dispute has emerged between local banks and a Nigerian firm over CBK’s plan to create a national real-time payments system.
• Authorities intensify crackdown on counterfeit fertiliser as farmers are urged to stay vigilant.
• Deposit rates fall for the third straight month as banks adjust to lower CBR.
• Uchumi’s shares rise despite ongoing financial struggles as investors remain optimistic.

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In a report by The Business Daily, President William Ruto has been pulled into a dispute between local banks and a Nigerian firm over the development of a real-time payments system, with Nigeria Inter-Bank Settlement System Plc (NIBSS) and its partners seeking President William Ruto’s support. The NIBSS is owned by the Central Bank of Nigeria. In the push for the Kenyan contract, NIBSS is in a consortium that includes Webmasters Kenya - the owners of eCitizen, and Ceva, as they seek to build a national switch for the Central Bank of Kenya (CBK). The Nigerian investors have clashed with the Kenyan banks, represented by the Kenya Bankers Association (KBA). Kenyan banks are pushing for an upgrade of the Pesa Link Service, which they argue is faster, cheaper, and would be fully Kenyan-owned. .KBA’s proposal will see the ownership of PesaLink incorporate the CBK, Kenyan banks, Safaricom and other stakeholders in the payments economy. The dispute has now seen NIBSS request a meeting with the President, seeking his help in pushing the CBK to award it the lucrative contract. CBK aims to establish a seamless Fast Payment System (FPS) to enable instant transactions across banks and licensed payment providers.

A report by the Auditor General has revealed that over 30 schools, including Mang’u High, St Mary’s Yala, and Maseno School, charged parents extra fees without approval from the Ministry of Education, violating government guidelines on free day and secondary education. The People’s Daily reports that some schools charged up to Ksh30,000 per student for development projects, while others imposed unapproved levies for Parents Association (PA) support programmes, infrastructure projects, and capacity-building. In some cases, the funds were mixed with school fees, making it unclear how they were managed. The report highlights financial irregularities such as unsupported payments and procurement issues, with concerns raised over unapproved fees amounting to hundreds of millions.

The Kenya Revenue Authority (KRA) collected Ksh12.47 billion in taxes from betting firms in the eight months to February 2025, surpassing its target with a performance rate of 110.2 percent, making it the top-performing tax category, in a report by The Business Daily. This growth is attributed to KRA’s enhanced integration with betting firms, alongside an increase in the number of companies in the sector, which rose to 200 by June last year. In the previous financial year, KRA collected Ksh24.2 billion from the betting industry, marking a 26.2 percent increase from the Ksh19.2 billion recorded the year before. Despite this strong performance, other tax heads struggled, with Pay As You Earn (PAYE) and non-oil taxes falling below targets at 92.8 percent and 92.7 percent, respectively. Oil taxes were the only other category to exceed projections, collecting Ksh224.9 billion. KRA’s total revenue collection for the period reached Ksh1.62 trillion, translating to a 95.6 percent performance against the target, as the taxman pushes to meet its Ksh2.68 trillion goal for the financial year ending June 2025.

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Farmers have been urged to stay vigilant after the Anti-Counterfeit Authority (ACA), in collaboration with the National Police Service, seized over 200 bags of counterfeit fertiliser worth Ksh23 million in Molo, Nakuru County, leading to the arrest of two suspects. ACA Executive Director Dr Robi Njoroge warned that fake agricultural inputs pose a major threat to food security and farmers’ livelihoods, as they lead to poor harvests and soil degradation. This crackdown follows an earlier operation in Nairobi’s Kariokor, where authorities seized over 19,000 counterfeit fertiliser bags meant for fraudulent repackaging. ACA has intensified its efforts to combat counterfeits, having confiscated fake fertilisers worth Ksh7.4 million and agrochemicals valued at Ksh39.7 million between 2020 and 2025. The government has also procured 99 million bags of subsidised fertiliser this planting season to support genuine supply. Farmers are advised to buy from reputable dealers and verify certification marks to avoid losses, as reported by The People’s Daily.

Banks have reduced interest rates on deposits to an average of 9.76 percent in February, the lowest in 15 months, down from 10.05 percent in January. This follows a series of Central Bank Rate (CBR) The Business Daily, the trend marks the third consecutive month of decline, reversing the high rates banks had offered to attract savers amid competitive government returns, as reported by The Business Daily. The lending rates have also started to decline, dropping from an eight-year high of 17.22 percent in November to 16.41 percent in February. With inflation remaining within target and relative exchange rate stability, further rate reductions are expected. The Central Bank of Kenya (CBK) has urged banks to pass on the benefits of lower rates to borrowers, with another CBR review set for April 8.

According to The Star, Uchumi Supermarket’s shares gained momentum at the Nairobi Securities Exchange (NSE), trading 870,400 shares to rank among the top five movers alongside Safaricom, KCB, Equity Bank, and Co-operative Bank. The retailer’s share price rose by 3.2 percent to close at Ksh0.32 as investors remained hopeful for a capital injection following a recent financial meeting. Meanwhile, Unga Group led the week’s gainers with an 8.48 percent rise to Ksh24.95 after returning to profitability, while Centum PLC saw a 2.75 percent increase after announcing a Ksh387 billion partnership for job creation in Vipingo. Investors now await Equity Bank’s annual financial results, expected to set new profit records.