Kenya has approximately 45 digital lending platforms which provide quick and easily accessible loans to individuals and small businesses. The industry remains largely unregulated and most of the lenders attach high charges to their loan facilities.
Lawmakers want the Central Bank and the Communications authority to create rules for digital credit providers. The MPs would like to limit the fees charged by the mobile lenders.
A report by the Communication, information and innovation committee states, “The Central Bank of Kenya and the Communication Authority audit all unregulated money lending fintech firms which leverage on mobile platforms and subject them to the applicable money lending regulations within six months.”
The MPs blame regulatory gaps for lack of competition in the digital lending industry. In 2018, the Communication Authority sought to have Kenya’s leading mobile operator – Safaricom – split due to claims of dominance in the telecommunications sector.
The parliamentary committee members recommend that CA present bi-annual reports to parliament that outline the level of competition in the mobile services industry and show if a dominant player exists.
