Success of digital economy lies in transparency

The over 20 million Kenyans who own smartphones can effortlessly hail a taxi. file photo | nmg
The over 20 million Kenyans who own smartphones can effortlessly hail a taxi. file photo | nmg 

Kenya’s digital economy has experienced significant developments in recent years with new applications powering themselves to ubiquitous status soon after launch.

The over 20 million Kenyans who own smartphones can effortlessly hail a taxi, order a fresh meal, an e-book or buy a television set from their living room or behind the office desk.

This phenomenon is not unique to our geography; last year, global e-commerce sales topped the $2.29 trillion mark, despite the fact that half the world’s population is offline.

Technological advances ultimately make life easier for everybody but, like a double-edged sword, cut both ways - exposing consumers to a raft of risks which differ in magnitude.

Indeed, 70 per cent of global e-commerce customers are afraid that their digital activity is not secure. Data breaches and online fraud and scams, have been widely reported in the West, rank on the extreme end of the risk scale.


According to Consumers International, a global organisation made up of consumer groups including the Competition Authority of Kenya (CAK), over half a billion digital personal records were lost or stolen in 2015.

Despite this exposure, over 30 countries have not enacted cybercrime laws.

On the other hand, consumers sometimes receive goods of lower quality than marketed, are billed much more than was advertised or battle retailers holding onto refunds arising from botched transactions.

Unlike data breaches, it is easier to resolve these disagreements. However, it would be much better if all these incidences did not materialise to begin with; that the seller and buyer enter and exit an online transaction content.

That way, and with the catalytic backing of an increasingly extensive and affordable broadband network, e-commerce would blossom, even pulling the population currently shying away from trading online.

The demonstrable centrality of the digital economy globally, and the threats and opportunities it holds, compelled the Consumers International to theme this year’s World Consumer Rights Day on this industry.

This commemorative event, held annually on March 15, aims at promoting the basic rights of all consumers, and ensuring that those rights are respected and protected.

This year’s theme ‘Making digital marketplaces fairer’, will see consumer bodies push for digital market places that are more accessible, safer and fairer to consumers across the globe. Given the aforementioned challenges, the onus is on consumer protection agencies like the CAK to sensitise the public on these dangers, how best to protect themselves and channels of recourse when harmed.

Increasingly, the CAK have received and investigated various complaints in regard to digital platforms. These complaints informed the Authority’s move to oblige providers of digital and mobile based services to be more transparent to the consumers insofar as transaction costs are concerned.

Previously, members of the public were only made aware of the cost of a service after the fact – a setup which greatly disenfranchised customers to the benefit of profit-seeking service providers.

On a regulation front, the fact of the matter is that e-commerce is an extremely fluid industry.

Regulators are more often than not left playing catch-up, racing to learn how a new application works, its impact on the economy and the necessary regulation, if any, needed.

The European Court of Justice last December, after a protracted hearing, ruled that Uber is a taxi service, despite the firm arguing it is a digital platform and should remain immune to some laws.

Indeed, the entry launch of Uber in Kenya upended the taxi model, necessitating a multi-agency intervention to prosecute a raft of complaints raised by various stakeholders.

At CAK, we are committed to educating the public about their rights as part of our vision of achieving an economy with globally efficient markets and enhanced consumer welfare.

This education and sensitization remains critical for our young and growing economy, and will definitely continue even after the World Consumer Rights Day 2018.

Wang’ombe Kariuki is director-general, Competition Authority of Kenya.