Kenyans abroad to exorcise curse of dishonest relatives
Simon Nyagah lived in the United States for 14 years studying and doing business. He is one the founders of the US Diaspora Sacco Society Limited.
After attaining a business and marketing degree, Nyagah was employed by J P Morgan where he worked for eight years before starting his own business. He relocated to Kenya in 2010 and ventured into private enterprises.
Before going to the US in 1997 to study, Nyagah had worked with the Central Bank of Kenya and other banks locally.
During the time Nyagah lived in US, he would remit money back home through a close relative to finance property projects. The relative would brief him on the progress of the projects.
But little did he know that the relative was lying to him. He would divert the money to other purposes. Though he declined to divulge the actual amount of money he lost, Nyagah explains that he lost millions of shillings.
“When I came back, there was nothing on the ground. The relative was committing the money to unplanned purposes,” said Nyagah in an interview last week in Nairobi.
His is one of the sad tales of Kenyans living abroad who lose millions every year to relatives, friends, and unscrupulous investment agencies.
Despite this, most Kenyans in the diaspora have invested heavily in the property market back home. They have bought land and constructed buildings.
According to the Central Bank of Kenya, Kenyans in the diaspora currently remit over Sh100 billion every year through commercials banks and other authorised international remittance service providers such as Western Union and M-Pesa.
Thankfully, they might no longer fall prey to swindlers back home if fresh efforts by local property players and the Government materialise.
Local property firms have started holding homes expos to explain to Kenyans abroad the importance of investing back home as well as showcasing the various products available on the market.
The first homes expo organised by Kings Pride, a local property firm through its exhibition company Diaspora Homes Expo Company, was held in New Jersey in the US in August 2014.
Kings Pride Chairman David Karau says the expo attracted 24 local and international exhibitors and over 50 delegates. He said the expo offered a challenge for more Kenyans in the diaspora to invest back home instead of stashing their hard-earned money in foreign bank accounts.
“No doubt this will see a lot of wealth coming home from abroad. As players in the property and investment sector, we trust that the Government will provide the necessary infrastructure to enable Kenyans abroad to play their role in national development,” he says.
During the expo, Kenyans abroad signed deals worth Sh6 billion with local commercial banks and real estate firms. The deals will be executed in the next one year.
Kenya joins other countries which have tapped into the diaspora to build their economy.
Countries like the Philippines have institutions that develop human resources for export with the view to investing back home and supporting the local economy.
Other countries which have relied on their citizens in the diaspora to grow their economies include Israel, China, India, Indonesia, South Korea and Ethiopia.
Karau says that Kenyans living in the US are interested in investing in the property market back home and helping to reduce the current housing supply gap.
Kenya Commercial Bank revealed that it sealed retail and commercial mortgage deals worth about Sh5 billion during the exhibition while National Bank of Kenya signed deals valued at over Sh1 billion.
KCB Head of Diaspora Banking Vincent Aberi disclosed that the new deals are over and above an existing partnership with Kenya Diaspora Sacco where a Sh10 billion loan has been advanced for onward lending to the credit union members to invest in Kenya.
“Kenyans in the diaspora have demonstrated an appetite for investment in the country’s real estate market, but lack of proper procedures over the years that would have enabled them to monitor their investment saw a number of them lose millions of shillings to unfaithful friends and relatives,” said Karau.
He said Kings Pride signed deals worth Sh501 million for 40 housing units in Nairobi County.
“We are also developing a 50-acre piece of land in Machakos County where we want to put up 360 units to be sold to the diaspora community, “he said.
Martha Kanyumba Ikiki, a director with KDH Expo, confirms that Property Realty Company sold 75 plots in Magadi to the diaspora community to the tune of Sh15 million.
Karau says that the expo revealed the hidden investment potential in Kenyans in the diaspora.
He said a good number of Kenyans in the diaspora are planning to invest in real estate in various counties, including Kakamega, Bungoma, Mombasa and Laikipia.
“Our clients are more interested in finished residential and commercial properties. The diaspora community is eager to invest back home but they have been facing challenges of being swindled of their cash by relatives, friends and unscrupulous organisations,” said Robert Kibaara, the National Bank of Kenya executive director in charge of retail and business banking.
Sacco in the diaspora
On the other hand, Nyagah together with others in 2012 founded the Kenya US Diaspora Sacco, which currently has over 2,000 members.
“The Sacco promotes investment opportunities and savings among Kenyans residing in the US so that they can have a reliable and organised way to invest, access affordable credit, carry out projects, build businesses, or meet personal and family needs in Kenya. The Sacco was born out of the need to deal with the circumstances Kenyans in the US encounter every day,” Nyagah says