| dc.description.abstract | Consumer protection within any sector is not only important but necessary. The mode of achieving this protection and the extent to which a consumer ought to be protected has been a matter of academic debate and discourse for years. Some academics argue that intervention in the market place by the
government and players within any sector should be kept at a minimum to allow the market to operate at an optimum. On the other hand, there are academics who argue that a level of government and player intervention through enactment of policy, codes of conduct and legislation is both necessary and unavoidable because the market is unable to correct existing imbalances purely on its own. This research was based on the premise that ~some level of intervention is necessary in order to achieve an adequate level of consumer protection. The overall objective of the research was to undertake extensive study into the laws, regulations and institutions governing lending by banks in Kenya. Further, the research sought to look into the practical conduct of bank employees, in particular, credit officers when processing applications made by prospective borrowers, with a view of specifically assessing the information disseminated to such prospective borrowers at the initial stages of their application (disclosure).
Further, the primary research sought, albeit to a lesser extent to establish the extent of standardization of the bank's procedures, the level of discretion left to the bank's employees and the bank employees' awareness of the legal provisions governing lending by banks in Kenya. After collating the evidence on a practical level, this research sought to identify existing shortcomings, loopholes and weaknesses with the bank's application and processing procedures having regard to the governing legal and institutional framework. The research instruments used were interviews and focus group discussions. The research acknowledges the importance of the prospective borrowers making an informed decision, which ought to be respected.
The assessment of the laws, regulations and institutions governing lending by banks in Kenya was conducted by comparing the level of consumer protection
legal provisions and institutions operating within the Kenyan jurisdiction provide against those available in other jurisdictions such as the United Kingdom, Canada and Australia. It was not the intention of this research to suggest or prove that these alternative jurisdictions are wholly 'better' or somewhat more superior to the Kenyan jurisdiction but merely to compare the extent of the consumer protection provided for in the legal provisions. It is arguable that this approach provided a more wholesome picture of lending practices and procedures of banks. Further, it was recognized that the findings of the primary research may not necessarily be reflective of the conduct of all banks in Kenya as only representatives from a few banks were interviewed.
Finally, following this comprehensive assessment of the legal, institutional and practical framework governing lending by banks in Kenya, this research aimed to provide recommendations, where appropriate, for implementing changes that would arguably increase consumer protection within the lending sector by banks in Kenya. Given the promulgation of the Constitution of the Republic of Kenya in 2010 and its subsequent implementation, all legal provisions, including banking ones ought to be reviewed to align them to the new constitutional dispensation. It is hoped that the contents of this research will provide valuable insight into the review and/or amendment of the legal provisions governing lending by banks in Kenya. | en_US |
