Should Parliament Regulate M-KOPA and Co.? Babu Owino Thinks So

Last week in Busia County, fiery Embakasi East MP Babu Owino threw a punch straight at Kenya’s device financing giants like M-KOPA, OnFon Mobile, Watu Credit, and others. Speaking during a Youth Empowerment forum in Funyula, he revealed his intention to table a bill in parliament that seeks to regulate how Kenyans are charged for smartphones, bodabodas, and other gadgets bought on credit, claiming they exploit Kenyans through exorbitant prices..

In his own words (translated loosely from his Swahili speech):

“You buy a phone worth KES 10,000, and by the time you finish paying, you’ve coughed up over KES 30,000. Is that business, or is that theft? Even a boda boda worth KES 100,000 is financed at KES 300,000. This is exploitation. If it’s a phone of KES 10,000, why not pay KES 12,000? If it's a boda boda of KES 100,000, why not pay KES 110,000? That profit is enough, not triple the cost!”

What’s the Fuss All About?

The MP minced no words, calling out the device financing model as “the character of kasongo” (the character of the Kenyan president). He argued that Kenyans are being fleeced, citing examples where a KES 10,000 smartphone ends up costing over KES 30,000 to own, and a motorcycle originally valued at about KES 100,000 balloons to KES 300,000 by the time the loan is fully repaid. According to him, a reasonable profit margin should not exceed a few thousand shillings on a single device, not double or triple the original price. He states that the bill would introduce regulations to cap the profit margin on such devices and boda bodas.

For many, this is a long-awaited move. I’ve personally been vocal about this issue. I mean, let’s be real, these platforms are clever. They lure you in with a small deposit and the promise of “lipa mdogo mdogo” (pay little by little), which sounds like a lifeline for those who can’t afford to pay upfront. But what they don’t explicitly spell out is the sheer scale of the overcharge. It’s a system that preys on a lack of financial literacy and the desperate need for technology and mobility.

So, What’s the Other Side?

However, the debate isn’t one-sided. Some see these companies as pioneers, providing a much-needed service in a market where traditional banking often leaves out the majority. They provide a blueprint for bridging the financial gap in developing markets, giving millions of people access to smartphones, solar power, and motorbikes that would otherwise be out of reach. Companies like M-KOPA emphasize that they help customers build a credit history, which can open doors to other financial services. They also argue that the high cost factors in the risk of lending to underserved populations with no collateral, as well as the operational costs of their business model.

While this perspective holds some water, the question remains: does providing a service justify such a steep price tag? Is financial inclusion a noble goal if it comes at such an exploitative cost?

Your Turn to Speak!

The MP’s claim that a bill has been submitted to parliament is a significant development, even though it hasn’t appeared on the official National Assembly website yet. If it does, it could change the game for device financing in Kenya. But is it the right move? Should the government step in to regulate these platforms, or is this simply a case of a political stunt to get companies to the “negotiating table,” as some critics fear?

What do you think? Should the government regulate the device financing industry to curb what some see as exploitation? Or is this just a necessary evil, a trade-off for financial inclusion and access to technology? Let us know your thoughts in the comments!