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City Hall’s revenue collection falls after JamboPay divorce

Charles Kerich.
Nairobi County Finance executive Charles Kerich. FILE PHOTO | NMG 

The Nairobi County government has recorded a fall in revenue collection since its divorce from JamboPay in June.

In the three months that followed the parting of ways with the online payment platform, City Hall posted a fall of Sh336 million.

In total, the county collected Sh1.539 billion in the three months from over 130 revenue streams compared with Sh1.875 billion collected in a similar period last year.

According to data from City Hall’s revenue department, the county government recorded Sh502 million in June.

The revenue slightly improved to Sh587 million in July, only to dip to a low of Sh450 million in August.

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In a similar period last year, City Hall posted Sh720 million in June.

The amount dropped to Sh600 million in July and Sh555 million in August, with the total sum put at Sh1.875 billion.

The county introduced a new e-payment system in June as part of the Internal Revenue Management System (IRMS) that requires motorists to pay using USSD code *235#.

Web Tribe Limited’s parent company JamboPay set up the system.

The firm used to run the eJijiPay online payment platform on behalf of City Hall but the contract ended on June 7. The move saw the two parties end the more than five-year association which began on April 7, 2014, during which the firm digitised more than 130 of the 138 county revenue streams, collecting over Sh40 billion in the process.

The county government went ahead to launch a new USSD (Unstructured Supplementary Service Data) short code *235# in collaboration with National Bank, as a new way to pay for services.

New challenges

When contacted for comment, Nairobi County Finance executive Charles Kerich linked the reduced revenue collection to challenges arising from the introduction of a new online payments system.

Mr Kerich said that the county government was holding discussions with National Bank on how to address the challenges in revenue collection, with integration of the system being the main issue.

“The new system required a lot of modification and we are still discussing with National Bank on how to address the challenges we face.

“We are also looking at how they can enhance their capacity,” said Mr Kerich.

Revenue collection at City Hall has been on the decline for the second financial year running.

The county government collected Sh10.248 billion against a target of Sh15.5 billion in the financial year ended June 30.

This represented a paltry Sh148 million increase from the previous year when the county collected Sh10.1 billion in internal revenue against a target of Sh15.2 billion in the first financial year of Governor Mike Sonko’s regime.

The county government has introduced a raft of new taxes, levies and other charges aimed at raising revenue collection to Sh17.32 billion this financial year.

Last month, Governor Sonko said his administration was considering tapping Kenyan Revenue Authority’s services in revenue collection.

He said that they also plan to integrate their revenue collection system with printing of payment receipts and instant licensing to seal revenue loss loopholes.

“Plans are underway to engage KRA to be collecting revenue on our behalf.

“We will also engage the national government to second National Youth Service officers to our revenue department,” said Mr Sonko at the time.

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