The Competition Authority of Kenya (CAK) has fined asset financier Mogo Auto Limited KES 10,851,473 for violating the **Competition Act CAP 504**. In a statement issued on October 4, 2024, CAK detailed that the penalty was imposed after the company was found guilty of engaging in **false and misleading representation** and **unconscionable conduct** against its customers.
Mogo, a subsidiary of the **Eleving Group**, offers financial services in Kenya, including car financing, logbook loans, and loans for bodaboda and tuk-tuk operators. CAK’s investigation, triggered by complaints from four customers between May 2023 and April 2024, revealed that Mogo issued loans in Kenyan Shillings (KES) but structured repayments in U.S. Dollars (USD), causing unexpected higher payments for customers due to currency fluctuations. Additionally, the company altered loan terms without customer consent, shifting interest calculations from a flat rate to a reducing balance, further complicating repayments.
Beyond the fine, CAK directed Mogo to refund **KES 344,939** to three complainants who had been overcharged due to exchange rate discrepancies. Mogo is also required to conduct **consumer compliance training** for its employees by August 2025 and resolve all pending and future complaints swiftly. The company must also refrain from misrepresenting facts and engaging in conduct harmful to its clients.
In a public statement on October 4, 2024, Mogo Auto Limited addressed the fine imposed by the **Competition Authority of Kenya (CAK)** and expressed its willingness to settle the matter while clarifying that the settlement was not an admission of wrongdoing. The company emphasized that its decision was driven by a commitment to customer welfare.
Mogo explained that it offered **dollar-denominated loans** as one of its products, and noted that less than **15% of its customers** chose this option. While legal, these loans exposed borrowers to currency risks. The company pointed out that these dollar loans had a lower interest rate compared to **Kenyan Shilling (KES)**-denominated loans, but fluctuations in currency led to increased repayment amounts for some customers.
Mogo acknowledged the complaints raised through CAK and stated that it chose to enter into a settlement agreement as a gesture of goodwill to resolve the matter. The company clarified that its decision to stop issuing new dollar-denominated loans was voluntary, having taken effect in May 2024.
The statement underscored that the settlement does not imply illegal conduct, as dollar-denominated loans were compliant with existing regulatory frameworks in Kenya. Mogo reiterated its commitment to adhering to these regulations while prioritizing customer welfare.
