Business

Licenced digital credit providers rise to 58 after CBK gives nod to 7 more firms

CBK Governor Dr. Kamau Thugge presides over the launch of the Chora Plan financial literacy campaign on June 11, 2024. (Photo: CBK)

By Maureen Kinyanjui | Thursday, June 27, 2024

CBK said the move will intensify competition in the lucrative digital credit industry, providing more options for Kenyans seeking digital loans.

The number of companies allowed to offer digital credit to Kenyans has risen to 58 after the Central Bank of Kenya (CBK) licensed seven others.

The move, according to CBK in a statement issued on Thursday, will intensify competition in the lucrative digital credit industry, providing more options for Kenyans seeking digital loans.

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The Central Bank of Kenya highlighted that the new licenses are in accordance with Section 59(2) of the Central Bank of Kenya Act (CBK Act).

The Bank has been working closely with these applicants, engaging with other relevant regulators and agencies, including the Office of the Data Protection Commissioner, to ensure a thorough review process.

"The focus of our engagements has been on business models, consumer protection, and the fitness and propriety of proposed shareholders, directors, and management," the CBK said in the statement.

"This is to ensure adherence to the relevant laws and, importantly, that the interests of customers are safeguarded," the statement reads further.

Going further, The CBK expressed its gratitude for the efforts of the applicants and the support from other regulators and agencies throughout the process.

Fifth round of licencing

This is the fifth round of licensing since CBK started giving nods to DCPS in October 2022, after the six-month mandatory registration window expired.

CBK also said that other applicants are at various stages of the application process, mainly awaiting the submission of required documentation.

The applicants have been urged to submit the pending documents quickly to complete their reviews.

At the same time, CBK also addressed public concerns about unregulated DCPs which have been known for predatory practices, including high costs, unethical debt collection methods, and the misuse of personal information

To combat these issues, the CBK has taken steps to regulate the industry and provide oversight.

The public is encouraged to report unregulated DCPs to the CBK through the email address deps@centralbank.go.ke.