The Senate has called for a formation of a special committee to speedily investigate the activities of the Pan-aftican Financing Asset Company
Senate Trade and Industrialisation Committee is calling for an investigation into Watu Credit Limited following numerous complaints from customers over the rampant theft of motorcycles purchased from the credit firm.
Customers have petitioned the Senate over the suspicious loss of motorbikes that they purchased from Watu Credit Limited.
Members of the Senate Trade and Industrialisation Committee are casting doubts on the activities of the company and have demanded that Police IG Japhet Koome appear before it to shed more light on why the motorbikes issued by the firm disappeared without any trace.
The senators have also questioned how motorbikes sold by the company are being stolen despite being fitted with trackers
Nandi Senator Samson Cherargei, raising an alarm, added that the company has not provided evidence that it has reported cases of lost motorbikes.
Senator Jackson Mandago of Uasin Gishu also questioned why the bikes being stolen seem to be those for which payments are almost complete
Defending the company, Watu Credit chief executive officer Andris Kaneps said that their firm is majorly in the spotlight because 70% of motorcycles sold on hire purchase in the country are financed by them, creating a higher probability that their activity will be scrutinized.
However, the Senate committee is also questioning interest rates of 6% per month, which they called exploitative.
The senators stated that this means that if a motorbike retails at KES 150,000, customers will pay more than KES 300,000 at the end of the hire purchase term.
The CEO of Watu Credit defended this by saying that customers only pay 50% more in the hire purchase arrangement and that customers who can offer more collateral security can reduce the interest rate by up to 70%.