CBK Approves 10 Digital Lenders Out Of 288 Initial Applicants In New Lenders Law
Central Bank of Kenya has said that digital lenders that fail to meet strict customer protection rules introduced under Digital Credit Providers Regulations, 2021 will not be allowed to operate in Kenya.
In the recent past, there has been an increase in digital lending most households have adopted this kind of borrowing to get by on daily expenses. Due to the flooded market of digital lenders, Kenyans have in the past fallen victim to credit fraud that includes high-interest rates, rollover fees, and hidden charges when receiving credit. Also, unauthorized Digital Lenders have been found to abuse personal information as well as enforce unethical debt collection practices.
The Central Bank of Kenya (Amendment) Act, 2021, which became effective on December 23, 2021, empowers CBK to license, regulate and supervise digital credit providers (DCPs) to ensure a fair and non-discriminatory marketplace for access to credit. Subsequently, the CBK Digital Credit Providers Regulations, 2022, were issued and operationalized on March 18, 2022.
CBK has received 288 applications since March 2022 and has worked closely with the applicants over the last six months in reviewing their applications. Additionally, CBK has engaged other regulators and agencies pertinent to the licensing process, including the Office of the Data Protection Commissioner. So far, 10 applicants have now been licensed as DCPs, pursuant to the CBK Act and the Regulations.
Other applicants are at different stages in this process, largely awaiting the submission of requisite documentation. “We urge these applicants to submit the pending documentation expeditiously to enable completion of the review of their applications. All other unregulated DCPs that did not apply for licensing must cease and desist from conducting digital credit business,” stated CBK
Here is the List of Authorised Digital Credit Lenders; Ceres Tech Limited, Getcash Capital Limited, Giando Africa Limited, Jijenge Credit Limited, Kweli Smart Solutions Limited, Mwanzo Credit Limited, My Wagepay Limited, Rewot Ciro Limited, Sevi Innovation Limited, and Sokohela Limited.
Among the requirements to have digital lenders licensed is the disclosure of the total charges for their loans, including interest rates, late payment, and rollover fees, before disbursing credit to customers.