In a move to tame the wild digital lending space, the Central Bank of Kenya (CBK) has approved 41 more Digital Credit Providers (DCPs). This brings the total number of licensed digital lenders in Kenya to 126, up from 85 in October 2024.

Why This Matters: Bringing Order to a Messy Sector

The digital lending space in Kenya has been a double-edged sword—convenient and quick loans, but at the cost of high interest rates, shady debt collection methods and data breaches.

CBK has been working to reform the sector to restore sanity and protect consumers.

"The Central Bank of Kenya announces the licensing of 41 Digital Credit Providers (DCPs). This is in accordance with Section 59(2) of the CBK Act," CBK said in a statement.

700+ Applicants, But Not Everyone Gets In

Since opening the application window in March 2022, CBK has received over 700 applications. But only those who meet the criteria get licensed.

The vetting process involves close collaboration with oversight agencies like the Office of the Data Protection Commissioner (ODPC) to assess:

  • Integrity of leadership and ownership

  • Soundness of the business model

  • Consumer protection measures

  • Data privacy compliance

This robust framework ensures only responsible and transparent lenders are allowed to operate.

The Spark Behind Stricter Rules

CBK’s crackdown on digital lenders was largely triggered by public outcry over:

  • Predatory lending

  • Harassment from debt collectors

  • Unauthorized access and misuse of personal data

Some unregulated lenders went as far as shaming borrowers by sending messages to their contacts—a gross violation of data privacy and dignity.

By introducing a licensing regime, CBK is saying those days are over.

Protecting Borrowers and Restoring Trust

CBK is clear that this is not just about controlling the market—it’s about protecting Kenyans from financial exploitation.

The licensing framework:

  • Promotes ethical lending

  • Transparency in loan terms

  • Customer data protection* Borrower trust in digital credit

This will create a healthier financial environment, for lenders and borrowers.

For Pending Applicants: Get Moving

CBK is also advising applicants with incomplete applications to complete their documentation. Only full compliance will get a license.

“We urge all pending applicants to submit their required documentation to complete the licensing process,” CBK said.

What’s Next: Cleaner Lending

Kenya’s digital lending space is moving fast and with CBK involved, the future looks more stable, ethical and consumer focused.

Expect:

  • More credible lenders to enter the market

  • Tighter regulations

  • More transparency for customers

  • Stronger data protection