The Central Bank of Kenya (CBK) has licensed 29 more digital credit providers, expanding the regulated digital lending sector to 281 providers. This move is part of CBK's efforts to bring digital lenders under formal regulation and address concerns over costly loans, debt collection methods, and misuse of customers' personal information. The new licenses were issued under Section 59(2) of the Central Bank of Kenya Act.
The licensing process involved assessing the business models, consumer protection measures, and the fitness and propriety of proposed shareholders, directors, and management of the applicants. CBK received over 900 applications since March 2022 and has been working with applicants to ensure they comply with the law and protect customers' interests. The regulator aims to ensure that digital lenders adhere to relevant laws and safeguard customers' interests.
Digital credit providers mainly offer loans through digital platforms, including Unstructured Supplementary Service Data (USSD) codes. Their products include education loans, development loans, short-term personal loans, asset-financing facilities, and business loans, giving customers access to different forms of credit through digital platforms. This expansion of digital lending has been matched by an increase in the amount of credit being issued through the platforms.
As of August 2026, regulated digital credit providers had issued 9,596,509 loans valued at Sh165.1 billion. The growth of the regulated sector has been driven by CBK's efforts to bring more digital lenders under its supervision amid concerns over the practices of providers operating outside the regulatory framework. The regulator had previously approved 25 digital credit providers in July.
The decision to license and oversee digital credit providers was precipitated by concerns raised by the public about the predatory practices of unregulated digital credit providers. CBK listed the high cost of credit, unethical debt collection practices, and the abuse of personal information among the main concerns raised about unregulated digital lenders. The regulator is continuing to review applications from other digital lenders.
The licensing process for other applicants is still ongoing, with many firms at different stages of review and some yet to provide required documents. CBK has urged these applicants to submit the pending documentation expeditiously to enable completion of the review of their applications. The regulator has also called on members of the public to report digital credit providers operating without regulation through its designated reporting channel.
The latest approvals add to CBK's continued efforts to strengthen oversight of digital lending, with more providers now required to operate within regulatory and consumer protection rules. This move is expected to enhance consumer protection and promote responsible lending practices in the digital lending sector. CBK's efforts aim to promote a safer and more transparent digital lending environment for customers.
Key points
- The Central Bank of Kenya has licensed 29 more digital credit providers, bringing the total number of regulated providers to 281.
- The regulator has received over 900 applications since March 2022 and has been working with applicants to ensure they comply with the law and protect customers' interests.
- Regulated digital credit providers have issued 9,596,509 loans valued at Sh165.1 billion as of August 2026.
