The Competition Authority of Kenya (CAK) has issued a penalty of Ksh. 10,851,473.20 to Mogo Auto Limited (Mogo) for violations of the Competition Act CAP 504. The authority found that Mogo engaged in false and misleading representation as well as unconscionable conduct towards its customers. Mogo, a subsidiary of the Eleving Group, operates across 15 countries and offers vehicle financing, logbook loans, and loans to operators of boda boda and tuktuks in Kenya.
In addition to the fine, Mogo is required to refund Ksh. 344,939 to three customers due to excess charges and discrepancies in foreign exchange rates applied during loan issuance. The authority also directed Mogo to refrain from misleading clients in the future and to settle pending customer complaints promptly.
This decision follows investigations triggered by complaints from four customers between May 2023 and April 2024. Each complainant detailed issues ranging from unexpected changes in interest rates and loan terms to discrepancies in loan balances due to exchange rate fluctuations. In particular, customers were troubled by loan payments being calculated in USD despite loans being disbursed in Kenyan Shillings, leading to unpredictable repayment amounts.
Mogo admitted to the accusations and expressed willingness to settle the matter amicably. In the final settlement agreement, Mogo was ordered to pay the penalty and reimburse the complainants. The company must also ensure its staff undergo consumer compliance training by August 2025.
This case highlights the importance of transparency in loan agreements.
The full judgment is here and below
