This archive report was first published on 18 November 2019.
AO Bayusuf & Sons Ltd, a transport company, has taken Barclays Bank of Kenya Ltd to court over a disputed loan facility.
The company is seeking Sh25.9 million from the bank, alleging that the money was unlawfully debited from its account in March 2018.
According to court documents, the bank had offered a conventional asset facility to the company in March 2015, but the company later requested that the loan be converted to meet Islamic finance principles.
Barclays Bank agreed to convert the Sh300 million loan into a Murabaha facility, a type of Islamic finance product, but the company claims that the facility did not meet the required standards.
The company further alleges that the bank only disbursed Sh240 million instead of the agreed Sh300 million, and that the loan was made available over a period of one year instead of the agreed timeframe.
Barclays Bank, through its relationship manager Simeon Mzugha, has denied the allegations, stating that the bank had contractual and legal justification to debit the amount.
The case has been fixed for hearing on February 27, 2019.
Published on November 18, 2019.
