Central Bank of Kenya (CBK) has licensed additional 10 digital lenders, pushing up the total number of licensed Digital Credit Providers (DCPs) in the country to 32.

This is after 12 more lenders were cleared for licencing in January 2023 as the regulator gradually mops the ills perpetrated by the digital operators.

In a statement to newsrooms yesterday, the apex bank said it had received a total of 401 applications since March last year, meaning about 92 per cent of players in the digital lending space are yet to get a fresh CBK nod. “Other applicants are at different stages in the 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,” CBK said.

Licensing process

The 10 who have made it to the CBK list include Anjoy Credit Ltd, Asante FS East Africa, Extend Money Service Ltd, Colkos Enterprises Ltd, and Edomx Ltd. Others are Fourth Generation Capital Ltd, Jumo Kenya Ltd, Little Pesa Ltd, Okolea International Ltd, and Risine Credit Ltd.  The CBK also said it has engaged other regulators and agencies pertinent to the licensing process, including the Office of the Data Protection Commissioner.

The regulators are keen to address many complaints the public raised against digital lenders, mainly on shaming customers during debt collection drives. This led to the induction of strict consumer protection rules via the Digital Credit Providers Regulations 2021. Under the new regulations, the lenders are supposed to furnish CBK with a Certificate of Incorporation, Memorandum and Articles of Association of the applicant and that of any significant shareholder.

Also required include disclosure of the total charges loaded on loans, comprising interest rates, late payment and rollover fees, before disbursing credit to customers.

The deadline for compliance to the new rules elapsed last September, leaving only those that had applied to continue operating pending the approval process. New entrants are required to wait for licenses before starting operations.