Innovation without documentation: the Ksh 1 billion lesson in Kenya’s fintech IP wars

In the high-stakes world of Fintech innovation, where billion-shilling platforms can emerge
overnight, one question looms large,when does a brilliant idea become legally protected intellectual
property? This question took centre stage in July 2023,when the High Court of Kenya delivered a
landmark judgement in Stephen Muikia Njongoro v Kenya Bankers Association and two others
Commercial Case No. E438 of 2019, a case that tested the boundaries of intellectual property
protection in Kenya ‘s fast-evolving fintech sector.

Njongoro, an innovator, launched an audacious legal assault against the architects of PesaLink, the
ubiquitous real-time interbank transfer system that processes millions of transactions daily. Armed
with claims that his “All in one banking innovation” and “air money virtual banking transfer solution
innovation” formed the DNA of PesaLink, he demanded over KSh 1 billion in damages and a
permanent injunction against the defendants.

The stakes couldn’t have been higher not just for the parties involved, but for Kenya’s entire fintech
ecosystem. Yet, when the gavel fell, Njongoro’s empire of claims crumbled. Why? Because in

intellectual property law, vision without execution is merely vapor. This case offers a cautionary tale
for ambitious innovators and a masterclass in the unforgiving precision that intellectual property
protection demands.

1. THE CLAIM: INNOVATION MEETS ALLEGATION

Njongoro’s argument was that Pesa Link a real a real-time interbank transfer system developed by
Kenya Bankers Association and operated by Integrated Payment Service Ltd (IPSL) was a direct copy
of his conceptual banking solutions. He claimed to have shared those ideas with various
stakeholders, including the Central Bank of Kenya (CBK), only to watch them materialize as someone
else’s commercial triumph.
However, the Court found that Njongoro failed to demonstrate ownership of a valid copyright under
the Copyright Act,2001 (Cap 130). Section 22 of the Act clearly states that copyright protection
applies to original works fixed in a tangible medium, such as literary works, computer programmes,
or artistic expressions.
Njongoro’s “innovations” existed solely in the ethereal realm of concepts. No supporting
documentation, no code repositories, no registered copyright certificates,nothing that would
transform abstract thinking into legally protectable intellectual property. Section 2(2) of the
Copyright Act dictates that “Copyright shall not subsist in ideas, procedures, methods of operation or
mathematical concepts as such”

2. THE LEGAL STANDARD: PROVING INFRINGEMENT

To succeed in a copyright infringement claim, a plaintiff must prove:
• Ownership of the copyrighted work
• Originality of the work
• Copying or Substantial similarity by the defendant
These principles are well established and echoed in the case of Sanitam Services v Rentokil (2006),
where the court upheld patent rights based on clear documentation and registration.
In Njongoro’s case, the court noted that:
• He did not produce evidence of registration with the Kenya Copyright Board (KECOBO)
• He failed to show that the defendants had access to or copied his work.
• His claims were speculative and lacked technical or expert support

3. THE DEFENDANTS RESPONSE

The Kenya Bankers Association and IPSL mounted a defense that was both comprehensive and
compelling, presenting PesaLink not as the product of intellectual theft, but as the organic solution
to genuine market inefficiencies that had long plagued Kenya’s banking sector. Their narrative was
supported by detailed development timelines, independent technical documentation, and clear
evidence of legitimate research and development processes.
The Central Bank of Kenya(CBK), caught in the crossfire as the third defendant, played a particularly
interesting role in the proceedings. Rather than becoming entangled in accusations of complicity,
CBK successfully delineated its regulatory mandate from any operational involvement in PesaLink’s
development. This distinction proved crucial the court recognized that regulatory oversight cannot
be conflated with commercial participation, establishing an important precedent for future fintech
disputes.
The defense strategy brilliantly illustrated a fundamental principle of intellectual property law,
independent creation is a complete defense to infringement claims. Even if two innovations appear
remarkably similar, the absence of copying or unauthorized access makes infringement claims
legally impossible to sustain. The court’s acceptance of this defense sent a clear signal that Kenya’s
judiciary will not allow speculative litigation to stifle legitimate technological advancement.

4. LESSONS FOR INNOVATORS AND INSTITUTIONS

This case sends a clear message to Kenya’s growing community of tech ecosytem:
• Register your work early with KECOBO or Kenya Industrial property Institute(KIPI)
• Document your development process from concept to execution
• Seek legal counsel before sharing ideas with third parties
For institutions, the case underscores the importance of due diligence and IP audits when launching
new platforms.

CONCLUSION: TURNING IDEAS INTO ASSETS.

The Njongoro case is not a dismissal of innovation,it’s a reminder that legal protection demands
precision, evidence, and structure. In Kenya’s digital economy, ideas may inspire, but only execution
is protected. Innovators must move beyond the blueprint and embrace intellectual property law
otherwise there innovations will be merely an expensive exercise in wishful thinking.
In today’s competitive Fintech landscape, where the difference between breakthrough success and
catastrophic failure often hinges on intellectual property protection, innovators cannot afford to
treat legal compliance as an afterthought. Ideas may spark revolutions, but only properly protected
execution survives the marketplace.
In a world where tomorrow’s unicorn could emerge from today’s startup, Bellmac Consulting LLP
provides the legal foundation that transforms brilliant concepts into billion-shilling realities. Our
comprehensive intellectual property practice doesn’t just offer protection we architect complete
legal ecosystems that turn innovative concepts into impregnable commercial assets. From strategic
IP registration and meticulous compliance audits to cutting-edge Fintech advisory services and
regulatory navigation, Bellmac delivers the legal sophistication that separates market leaders from
cautionary tales.
Ready to turn your innovation into an intellectual property fortress? Connect with Bellmac
Consulting LLP today at bellmacconsulting.com or LinkedIn @Bellmac Consulting LLP.