Digital lenders, apps will now be subject to the Central Bank regulations, ending years of brute conditions for small loans.
The Amendment provides the Central Bank of Kenya (CBK) with the powers to license and oversight the previously unregulated digital credit providers.
CBK has also issued a draft Digital Credit Providers Regulations and invites public participation.
This comes after concerns have been raised by the public on predatory practices of the unregulated digital credit providers, and in particular, their high cost, unethical debt collection practices, and the abuse of personal information.
The Amendment requires CBK to publish Regulations within three months, i.e., by March 23, 2022, and accordingly CBK has developed the draft Regulations for public consultation.
The Regulations provide for inter alia the licensing, governance, and credit operations of Digital Credit Providers (DCPs).
They further provide for consumer protection, credit information sharing, and elaborate on the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) obligations of DCPs.
In line with the public participation requirements, CBK invites interested members of the public to provide comments on the draft Regulations that can be downloaded from the Central Bank of Kenya website.
The written submissions or representations may be forwarded to the Director, Bank Supervision, P.O. Box 60000-00200, Nairobi; hand- delivered to the Central Bank of Kenya Headquarters, Haile Selassie Avenue, Nairobi; or emailed to fin@centralbank.go.ke; to be received not later than Friday, January 21, 2022, at 5.00 p.m.
Additionally, in order to facilitate an orderly transition to a regulated environment, CBK requests all (unregulated) DCPs to provide their business details through the link indicated below, https://www.centralbank.go.ke/dcpdetails/ by January 21, 2022.
