Airlines to Compensate Passengers Up to Ksh77,000 for Flight Cancellations

Hello and welcome to the Money News Roundup Newsletter, where we cover new guidelines that will see KQ compensate passengers for flight delays and cancellations. We also cover a new proposal that will see fired government employees get pensions.

Airlines to Compensate Passengers Up to Ksh77,000 for Flight Cancellations

Airlines operating within the Common Market for Eastern and Southern Africa (COMESA) could soon be required to compensate passengers up to Ksh77,540 for flight cancellations and delays. 

This follows new guidance from the COMESA Competition Commission proposing cash payouts of between Ksh32,310 and Ksh77,540 based on flight distance and delay duration.

The guidance sets standards for managing cancellations, overbooking, lost baggage, and re-routing, and specifies that compensation must be paid in cash or the original form of purchase and not vouchers. 

The proposal comes amid rising passenger complaints, with Kenya Airways topping the list, followed by Ethiopian Airlines, Air Mauritius, and RwandAir.

The Commission’s review revealed that over 70 percent of affected passengers received no redress for delays or cancellations, while 28 percent of baggage-related complaints went unresolved.

As reported in the Business Daily, Kenya Airways, which cancelled 2,263 flights in 2024, more than any other regional carrier, confirmed receiving COMESA’s statement of concern and said its legal team is reviewing the matter.

COMESA’s proposal mirrors the European Union’s strict passenger compensation rules, where travellers can claim up to Ksh89,000 for long delays. The watchdog argues the new standards will promote accountability and fairness across Africa’s aviation sector.

Kenya Airways, which already reported a Ksh12.15 billion loss in the first half of 2025, has blamed frequent delays on shortages of spare parts and grounded aircraft. 

Sacked Govt Employees to Receive Pensions in New Bill 

Emuhaya MP Omboko Milemba is seeking to make pension an absolute right for all public officers, even those dismissed from service. 

Through the proposed Pensions (Amendment) Bill, 2024, the MP is seeking to amend the Pensions Act, Cap 189, and the Public Service Commission Act, Cap 185, to remove provisions that currently deny pension, gratuity, or compensation to dismissed officers. 

Milemba argues that the amendments align with Article 41(1) of the Constitution, which guarantees fair labour practices.

If passed, the government will no longer have the right to dismiss officers without compensation.

As reported by the Business Daily, the proposal is under review by the National Assembly’s Social Protection Committee, chaired by Thika MP Alice Ng’ang’a, before being introduced in Parliament.

NCBA Shares Hit Record High Amid Takeover Talks With Standard Bank

Shares of NCBA Group hit an all-time high of Ksh75.25 on Tuesday, from Ksh69.50, following reports that Africa’s largest lender, Standard Bank Group, plans to acquire it through its Kenyan subsidiary, Stanbic Holdings. 

The potential buyout, first reported by Bloomberg, could significantly reshape Kenya’s banking sector by creating a lender with assets worth about Ksh1.1 trillion, ranking third after Equity Group and KCB Group.

NCBA, valued at Ksh125 billion, has seen its share price surge 70.6 percent in the past year, while Stanbic’s stock has gained 63.1 percent. 

As reported by the Business Daily, NCBA ownership is backed by the families of former CBK Governor Philip Ndegwa (14.94 percent stake) and the Kenyatta family (13.2 percent) 

This will not be the first bank merger in Kenya, as previous bank consolidations have included KCB's acquisition of National Bank of Kenya and Equity Bank's acquisition of Spire Bank.

KDF to Form Construction Company 

President William Ruto has announced plans to form the Ulinzi Construction Company, a military-run firm under the Ministry of Defence tasked with spearheading infrastructure projects in Kenya’s most remote and underserved regions.

As reported by Capital FM, the company will enable the Kenya Defence Forces (KDF) to build roads, bridges, and housing in hardship areas like Turkana and West Pokot. 

Ruto stated that the government would support to equip the firm financially to ensure that it can meet its mandate.

Approved by the National Security Council in 2021, the company aims to deliver projects faster and at lower costs by leveraging KDF’s engineering expertise.

CBK Increases Its Gold Reserves by 41%

The Central Bank of Kenya (CBK) increased its gold holdings by 40.8 percent to Ksh238 million in the year ending June 2025, marking a major step toward diversifying foreign reserves amid global uncertainty. 

The rise from Ksh169 million reflects both new purchases and higher global gold prices, which surged to record highs above Ksh526,000  per troy ounce (0.03kg). 

As reported by the Business Daily, CBK’s move aligns with a global trend where central banks are boosting gold reserves to hedge against currency volatility and geopolitical risks. 

Despite the increase, gold still accounts for less than one percent of Kenya’s total reserves of Ksh1.43 trillion. Governor Kamau Thugge had earlier indicated plans to expand CBK’s gold portfolio to strengthen its balance sheet and enhance financial stability.

Kenyan Passport Drops to 73rd in Global Ranking

The Kenyan passport has dropped to 73rd globally in the latest Henley Passport Index, down from 68th earlier this year. 

Kenyan passport holders can now access only 70 destinations visa-free, mostly within East and Southern Africa, with none in the Schengen area. The ranking continues a long-term decline from a peak of 55th in 2006. 

As reported in Kenyans.co.ke, the drop comes months after President William Ruto introduced visa-free entry for Africans and the Electronic Travel Authorization (ETA) system for other visitors, aiming to boost tourism and trade despite global mobility challenges.