Seven Digital Credit Providers have recently been granted licenses by the Central Bank of Kenya (CBK), marking a significant expansion in the regulatory framework for financial services in the country.

This development brings the total number of licensed Digital Credit Providers (DCPs) to 58, following the earlier licensing of 19 providers in March 2024.

Under Section 59(2) of the Central Bank of Kenya Act, the CBK has announced these new licenses, reflecting a thorough review process that began with over 550 applications received since March 2022.

The CBK has emphasized its meticulous approach in assessing these applications, focusing on criteria such as business models, consumer protection, and the suitability of proposed shareholders, directors, and management.

"The focus of the engagement has been inter alia on business models, consumer protection and fitness and propriety of proposed shareholders, directors and management," CBK stated in a released statement.

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"This is to ensure adherence to the relevant laws and importantly that the interests of consumers are safeguarded."

The CBK also expressed gratitude for the collaboration of applicants and support from various regulatory bodies and agencies throughout this process.

However, it noted that several other applicants are still in different stages of the review process, awaiting the submission of required documentation.

"We urge these applicants to submit the pending documentation expeditiously to enable completion of the review of their applications," CBK emphasized.

Concerns from the public regarding unregulated DCPs prompted the CBK to call for vigilance, urging individuals to report any unauthorized providers through [email protected].

Issues such as high costs, unethical debt collection practices, and misuse of personal information have underscored the importance of stringent regulatory oversight in the digital credit sector.

The licensing and oversight of DCPs by the CBK represent a proactive step towards enhancing consumer protection and ensuring the integrity of financial services in Kenya's digital credit landscape.