Central Bank of Kenya (CBK) and legislators have been urged to support development of progressive regulations to enable the rapid growth of financial technology companies in the country. 

Duncun Motanya, CEO of Zenka Finance, a mobile fintech company said regulating the sector with appropriate rules of play would go a long way in not only achieving this but also create more job opportunities for Kenyans.

He said he sees the industry’s positive contributions to the economy and strategic partnerships as key developments that will drive the industry towards professionalism and delivery of more value to users.

Local market

Motanya said the signing of a FinTech Co-operation Agreement between the Monetary Authority of Singapore and Central Bank of Kenya late 2019, opens a new collaborative front that will help the local market.

The agreement, he added, would help players in the local market learn valuable regulatory lessons and adoption of international best practices to take operators in the next growth phase.

Monetary Authority of Singapore is among the World’s most innovative Fintech hubs that made Singapore one of the first developed countries to set up a regulatory sandbox that allows fintench companies to experiment new products and services in a live environment under close watch of financial market regulators.

Motanya said regulatory sandboxes support innovation and allow authorities to actively participate in the deployment of new products and create the necessary legal frameworks for new types of services.

“We are very excited by the progress of these development and hopeful that the two authorities will collaborate and accelerate efforts to develop the FinTech space in Kenya.

I believe both the industry and customers expect the legislators to support the professionalisation of the industry by creating a framework of minimum requirements for a company to become a digital lender.” 

He noted that Digital Lenders Association of Kenya (DLAK) has already identified the need to implement some regulations over and above the Code of Good Conduct.

Some of DLAK’s proposals include a minimum capital requirements, experience requirements for key personnel heading and managing the business, for instance and a minimum three years’ experience in managerial positions in the financial sector.