Was It The Economy That Improved Or The Industry Captains Knack For Being Economical With The Truth

How is it that one commercial bank announces superprofits while another one declares subdued results, yet both practice similar philosophies whilst operating in the same marketplace?

Are other sectors sacred and accessible to a chosen few and some others spared for Medusa's children?

Did some banks grow phenomenally undeterred as others got affected by the pandemic? And where is the consumer protection body in all these pronouncements for they hold sway on consumers decision making?

If you've lived in this country over the last decade and deep within the majority herd characterised by ultra-sensitive pockets, then, without a doubt, life has increasingly become harder. In fact so much so that when a single coin is added to the economy, it is felt like the sun's rays would when piercing through the trees right down to the forest floor, for it would circulate pretty fast.

But when the banks boldly declare impressive returns, and our empty pockets themselves serving as millions of financial seismic sensors, register nil movements, then we must wonder aloud at how this windfall collectively escaped our economic participation.

Businesses across the country are folding up faster than the earth can rotate on its axis, whilst these banks grow even bigger—kudos to them, their open application of game theory notwithstanding. With every turn, our part of the world creates a multi-millionaire and condemns millions into abject poverty. For how long can the economy hold onto both ends of this continuum without upsetting the peace? Cases of petty theft and violence are growing faster than the economy can meet the citizenry's basic needs in a manner that is fair and square.

Granted, perhaps individually, we are stuck with outdated models while the financial services world has adapted quite well to new ways. Our inertia-driven state calls for more resources to complete the shift. Be that as it may, necessity, as the mother of invention, would not let us mark time for that long when desperation lurks in the shadows. Someone must step in and foot the bill of change. That is the new CSR opportunity.

So, what is the explanation for this selective growth? When the pandemic struck hard in 2020, some banks provided for the worst-case scenario and held back plenty of fat to offset any losses in their customer base's inability to meet their obligations.

Others never made such humongous provisions and instead run the year as if nothing was wrong. A combination of lucky factors saw them through and hence the announcement of huge bonuses by some of them for 2020. I am not sure that God would accept a bonus under such circumstances.

The reverse has now happened. Those who provided for the harsh times have simply written back the same provisioned sums and reflected huge positive movements in their books. And those that never made adequate provisions are now announcing marginal growths having provided for them this time around. So, has the economy grown or not? Trust what your pocket tells you, after all, they are always with you.

It is unfortunate, that when these institutions made provisions, they took to mass media, milked the opportunity, and made cheese out of it as they whined about the harsh economic downturn. With a reversal of the same numbers in their books, they have resurfaced and whetted the appetites of we mouse brains with more cheese. We are fixated on the results more than we should with why all else is not working well.

Obviously, there is some growth, but it is not enough to send the economy on a smile-carrying trajectory. The national treasury's spirited efforts to have the debt repayment rescheduled by lenders point to a money stressed economy. Debt level growth has outpaced that of the sources of repayment and has led us to this state of affairs filled with stories and acrobatics from the treasury.

Stunted inflows from coffee and tea are less helpful at the moment but remittances from Kenyans in the diaspora have partly helped steady the shilling against hard currencies. The latter, just like the personal determination of our world-beating athletes, has little to do with government and private sector policy. The diasporans, at the individual level, send money for their own reasons from economies doing better than ours.

Hope is known to generate optimism which in turn influences investment and purchasing decisions. That lifeline provided by diasporans could easily be the string that holds everything together for now.

So, how does one part of the economy grow while the other sectors struggle? Besides being a testament to the excessively higher interest rates borne by borrowers, the story only seems to add up because trusted sources and faces tell the story of an expansion that hardly reflects in our pockets.

The consumer lobby groups at the moment cannot call out these institutions and question the way this information was shared out to the consuming public, which is, for the most part, financially illiterate. They will instead find fault with smaller players and make news and examples of them. Are they really fit for purpose? They are like cats chasing rats instead of being lions hunting down Buffalo. Why aren't they challenging the huge growth rates amid a struggling population? Companies that own patents on high-demand products or services can boast of such growth rates without looking odd.

The information asymmetry should concern consumer lobby groups immensely. They should be a worried lot right now.

When it finally clicks and someone institutes a class action suit, it may be against any industry deemed exploitative and may enjoin respective lobby groups for collaborating in silence.

Now the banks are talking of switching to risk-based lending without any lobbying at all. The financial sector remains very much a lender's market and not the consumer's market that it ought to be.

There is more coming. Watch this space....