The festive season is upon us! Welcome to our 17th Money Weekly Roundup of 2023.

This week, Kenya boldly declared it’s intent to become the first country in the world to abolish Visa requirements for all foreign travelers, an unprecedented move that would put a significant dent on revenue collections.

Meanwhile, it is good news for Hustler Fund borrowers after President William Ruto increased the interest on their savings to 12.5% in the financial inclusion programme where over Ksh2 billion has been saved.

Below, as we do every Friday on Money Weekly, we break down for you the top money news from the last seven days that may have an effect on your pocket.

What happened this week

💸 Gov’t to Forgo Ksh5 Billion Revenue Annually in Visa Waivers

According to President William Ruto, starting January 2024, travelers from all nationalities coming to Kenya won't need a visa. This announcement, made during Kenya’s 60th Jamhuri Day celebrations, is a first in the world. And it comes with financial implications for the country.

Our hot takes are below as we wait to learn more about the landmark policy adjustment:

• Ksh5 Billion Revenue Loss: National Treasury estimates show Ksh5.67 billion in revenue was expected from immigration visas and other consular fees for 2023/24 FY. 

• Visa fees increase halted: A November gazette notice had increased fees to $100 (Ksh15,300) for a Single Entry Visa, $500 (Ksh76,700) for a Multiple Entry Visa among other changes that were to take effect from January 1, 2024. 

• Electronic Travel Authorization (ETA): A new system is to be unveiled by government for traveller identification similar systems are already in place in the UK and Canada. A $30 (Ksh4,600) fee is to be charged with decisions on applications made in “two weeks”. 

• Visa-Free Status: Visa-free travel allows visits for tourism or business without a visa, for short stays. President Ruto emphasises support for the African Continental Free Trade Area (AfCFTA) through visa abolition.

• Security Concerns: Critics argue new policy removes rigorous scrutiny embedded in visa processing. But the government says it will be relying on an integrated criminal records database for screening in partnership with source countries and that “not everyone will be allowed to enter the country.” 

• Boosting Tourism: President Ruto hopes visa-free entry will boost tourism and foreign currency reserves.

• Reciprocity: Critics argue that a lack of reciprocity from other nations makes the decision ill-advised. Currently, Kenyan passport holders can only access 76 destinations without a visa. Read More.

📉 87% Of Kenyans Have Reduced Their Personal Expenditure

Meanwhile, a poll released this week by TIFA Research shows 87% of Kenyans have reduced their expenditure as a way of dealing with the soaring cost of living. Reductions across expenditure categories include 15% on transportation, 9% on clothing and 8% on entertainment expenses. 

• Staggering Cuts in Food Expenses: Food is the primary category where individuals across income groups have cut expenses due to inflation. It recorded cuts as high as 79% for respondents earning Ksh20,000 and above. 

• Perception of Economic Situation: 84% of Kenyans perceive their current economic situation as worse than a year ago. This sentiment is consistent across different income groups and political affiliations. Read More.

🇰🇪 Hustler Fund Goodies and other Jamhuri Day Highlights

During the Jamhuri Day celebrations on Tuesday, President William Ruto announced the increase of interest earned on savings made by Hustler Fund borrowers to 12.5%. This is relatively higher than the average industry earnings on savings accounts of between 5% and 10%. Other highlights from the head of state’s speech include: 

• Disbursement of Social Protection Funds: funds for the elderly, orphans, and those with severe disability to be accessed via nearby M-Pesa agent shops free of charge.

• Faster NSSF Payouts: President said NSSF processing period reduced from 82 days to 10 with plans to reduce waiting period to just one day by the end of 2024. 

• Employment Prospects: Affordable Housing Programme, according to President Ruto, has already created 120,000 jobs in 33 active sites with 31 more expected to commence in January 2024. Separately, the President also says Meta - Facebook’s parent company - is to expand content monetisation opportunities to Kenyans after a successful pilot.  

• ICT hubs: Amendments to NG-CDF Act to pave way for construction an ICT hub in each of the 1,450 wards in the country. Read More.

🏭 Nzoia Sugar Company Resumes Operations after 21 Month Hiatus

Moving over to the private sector, over 67,000 sugarcane farmers can now sigh relief after the Nzoia Sugar Company resumed operations. The factory had halted its operations following a government directive and a lack of cane. The factory is expected to revive the local economy after a 21-month hiatus. Read More.

🚨 Profit Alerts Hit 12 at the NSE

This comes as Express Kenya Limited has issued a profit warning for the year ending December. The firm anticipates earnings to be at least 25% lower than the previous year. Slowed economic activity and reduced demand for warehousing operations have been cited as the reason for the low performance.

This comes after Kakuzi Plc also issued a profit warning, bringing the total warnings issued by companies listed on the Nairobi Securities Exchange (NSE) to 12, including Sameer Africa, Crown Paints, and Nation Media Group. Nonetheless, Credit Bank is still keen to list on the NSE. Read More.

Want more details? Check our long-form weekly update here:

This week’s finance tips

Welcome to Money254's Money Tips! Here, we share quick and easy tips to help you understand and manage your money better. We break down the tricky parts of handling your cash, so it's simple and clear for you.

Money254 MoneyTok of the week:

Wondering how to make your money work smarter, not harder? We've got your back! This week, we're breaking down Money Market Funds in Kenya with some quick facts!

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That’s a wrap for this week’s Money Weekly! We hope you had a great Jamhuri day and are looking forward to the festive period ahead.

Also, don’t forget to download the Money254 App on the Google Play Store, and remember that we can help you compare over 300 loans, savings accounts, current accounts, and more if you’re thinking about your next product.

Sincerely,

Eric and the Money254 editorial team.