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Kenya has been ranked top in Africa in global fintech rankings showing the country’s potential for innovation and the resultant strides in financial inclusion.

The Global Fintech Ranking Index 2021 whose theme is bridging the gap also ranked Kenya at position 31 globally having moved up 11 places compared to last year.

Kenya originally took a “wait and see” approach to fintech regulation, especially with regard to M-Pesa which bore fruit in the mass adoption of mobile payments. 

Digital credit was next to go mainstream, with dozens of fintechs – including Silicon Valley backed Tala and Branch – enabling microloans to millions of Kenyans through mobile apps.“But basic protections for borrowers were lacking.

Ordinary Kenyans found themselves facing rates of 400 per cent per year, as well as questionable debt collection practices, including contacting debtors’ friends and family members harvested from their mobile contact list, in the event of a default,” says the report.

As in China, Kenya has now switched gears, and is now legislating new rules for fintechs, ranging from licence requirements to data protection laws compliant with General Data Protection Regulation.

“The regulatory environment is becoming quite challenging,” says Ali Hussein Kassim, chairman of the Association of Fintechs in Kenya.
He wants more engagement between the public and private sector.