New forum to resolve credit disputes

Creditors have launched an alternative dispute resolution mechanism to help resolve amicably claims raised by borrowers who accuse lenders of wrongly forwarding their names to credit reference bureaus.
Under their umbrella body, Association of Kenya Credit Providers (AKCP), the lenders said the move seeks to efficiently resolve multiple disputes related to credit information sharing in the country.
“The courts will prefer that the ADR mechanisms that are available are exploited before disputants file cases in court,” the presiding judge, Commercial and Admiralty Division, Justice Ochieng’, said during the launch ceremony at Kenya School of Monetary Studies Tuesday.

According to AKCP, Kenya becomes the first nation on the continent to have a fully-exclusive centre for handling such disputes.
The centre will be housed at the Kenya School of Monetary Studies.

INDEPENDENT COMMITTEE

The centre is to be headed by an independent steering committee with representation from the Judiciary, Consumer Federation of Kenya, Religious bodies and credit providers.

“Launch of the centre augurs well with the strategic direction we are pursuing at the Chartered Institute of Arbitrators,” the chairman of the Chartered Institute of Arbitrators, Kenya Chapter, Mr Kariuki Muigua, said.

Launch of the centre comes on the back of several court cases involving creditors who have sued banks seeking millions in compensation for having been wrongly listed with credit reference bureaus, thus restricting their access to credit.

In their cases, the plaintiffs have pointed out that they were not informed of their listing, and that the information was inaccurate, and that even after they had paid up, the details were not updated.

The CRB Regulations 2013 provides for consumer rights to the access and correction of their credit information held at licensed bureaus. Consumers are also entitled to one free credit report annually.