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Regulation of digital lenders

17 August 2021
– 2 Minute Read


The Departmental Committee on Finance and National Planning of the National Assembly (the Committee) approved the Central Bank of Kenya (Amendment) Bill (National Assembly Bill No. 47 of 2020) (the 2020 Bill) (see overview here) and the Central Bank of Kenya (Amendment) Bill (National Assembly Bill No. 10 of 2021) (the 2021 Bill) (see overview here) (together the Bills) with amendments. The Bills seek to regulate digital lenders.

Some of the proposed amendments to the Bills include: 

  1. the inclusion of a compliance period following the gazettement of the Bills within which existing digital lenders will take the necessary measures to ensure compliance with the regulations;
  2. provisions allowing digital lenders to submit credit information from credit reference bureaus; 
  3. provisions empowering the Central Bank of Kenya (CBK) to determine the pricing of digital credit products;
  4. deletion of capital and liquidity requirements; and 
  5. appointment of the CBK as financial ombudsman with powers to make regulations on dispute resolution.

The proposed amendments to the Bills aim at addressing the concerns of various stakeholders. They provide more clarity and completeness to the Bills and seek to ensure that the regulation is proportional to the digital lending activities. However, the Bills are yet to be formally consolidated.

We understand that the Central Bank Amendment Bill (National Assembly Bill No. 21 of 2020) (see overview here) has since been re-published into the 2021 Bill hence its earlier wide proposals to expand the CBK’s regulatory powers over financial products and financial services generally (beyond digital credit) has been eliminated.