Stanbic Bank ordered to pay ex-journalist KSh 1M for erroneous CRB listing

- Mwenda Njoka and his wife Hilda Kaari sued CfC Stanbic Bank and CRB Africa for wrongfully listing them on CRB

- They argued they were denied loan by Barclays Bank Kenya because of the erroneously blacklisting on the CRB

- In their suit filed in August 2012, the couple was seeking KSh 5 million for general damages caused and injuries suffered

- CRB Africa has been on the spot in the recent days over huge number of loan defaulted blacklisted, especially the youth

Court has ordered CfC Stanbic Bank to pay ex-journalist Mwenda Njoka and his wife Hilda Kaari KSh 1 million for forwarding their names to the credit reference bureau (CRB) for blacklisting despite having settled their debt with the lender.

The amount was awarded as a compensation for general damages and injuries the couple suffered as a result of the erroneous blacklisting.

Mwenda Njoka and wife sued CfC Stanbic Bank and CRB Africa Ltd in August 2012 seeking KSh 5 million compensation for general damages, falsehoods, costs and interests. Photo: The Times of Israel. Source: UGC

The ruling, delivered in May 2019, was on a suit filed against CfC Stanbic Bank and Credit Reference Bureau Africa Ltd by Njoka and Kaari in August 2012 and which sought for a KSh 5 million compensation for general damages, falsehoods, costs and interests.

The couple argued because of the erroneously blacklisting, they were denied credit by Barclays Bank of Kenya, money that was to be spend on purchasing a house of which they had paid 50% deposit according to Business Today.

Njoka and Kaari alleged the blacklisting was not just unlawful and but also malicious and accused the CRB for failing to verify the information they had received CfC Stanbic Bank.

According to the pari, they had already settled all the outstanding debts they owed the lender at the time of the wrongful listing on the CRB.

The reference bureau tried to distance itself from any liability and shift blame to the bank, arguing the information it had on its database was provided by the lender but Justice Eric Ogola who was hearing the case did not buy the argument.

A 2018 report by Financial Study Deepening (FSD) indicate more than 500,000 loan defaulters, majority of whom are youth aged between 18 and 25, are blacklisted on the dreaded CRB and are therefore unable to access bank loans.

The huge number of defaulters has been a cause of concern, especially among leaders who feel listing of loan defaulters on the CRB was stifling growth.

Belgut MP Nelson Koech had proposed for amendment of the Credit Reference Bureau Regulations 2013.

Koech's proposed amendment was seeking to stop the local lending institutions from sharing information of borrowers with non-parties in efforts to recover their debts.

In a letter dated May 21, 2019, addressed to the Speaker of the National Assembly Justin Muturi, the legislator proposed the lenders should revert to the conventional ways of recovering debts without sharing borrowers' information.

The MP's main concern was that listing of loan defaulters on the CRB was stifling growth, especially among the youth.

"The practice of sharing borrowers' information with listing claims of as low as KSh 100 has denied growth to the enterprising youth," Koech argued.