The Central Bank of Kenya (CBK) has slapped digital lenders in the country with a 6-month ultimatum to renew operation licences to comply with the recently formulated regulations.
Speaking on Tuesday, March 15, 2022, CBK Governor Patrick Njoroge stated that the new regulations will be gazetted following the completion of the crackdown on unlicensed digital lenders.
In December 2021, President Uhuru Kenyatta directed CBK to rein in on rogue mobile lenders who are infringing on user's privacy.
“Regulations governing Digital Credit Providers will be gazetted later this month to pave way for the licensing and oversight of DCPs by CBK,” Njoroge said.
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“All previously unregulated DCPs will be required to apply to CBK for a license by September 2022 or cease operations," he added.
The Digital Credit Providers Regulations, 2021 allowed CBK to crack the whip on digital lenders that contact third parties in a bid to recover debts.
Under the new legislation, lenders are required to apply for licenses from the CBK, as compared to previously, when they only had to register to set up operations in the East African country.
Since the entry of digital lenders in the country, Kenyans have raised concerns over the tactics employed by some of them in debt recovery.
Stakeholders have often called upon the government to streamline the sector, prompting action from President Kenyatta and the CBK.
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