Kenya’s regulated digital lending sector has expanded to 281 providers after the Central Bank of Kenya (CBK) licensed 29 more digital credit providers, widening oversight of a sector that has faced complaints over costly loans, debt collection methods and misuse of customers’ personal information.
The new licences were issued under Section 59(2) of the Central Bank of Kenya Act, following the approval of 25 digital credit providers announced by CBK in July.
CBK said it had received more than 900 applications since March 2022 as it moved to bring digital lenders under formal regulation. The regulator said it had worked with applicants to assess their business models, consumer protection measures and the fitness and propriety of their proposed shareholders, directors and management.
The review process, CBK said, was aimed at making sure digital lenders comply with the law while protecting people who use their services.
“This is to ensure adherence to the relevant laws and importantly that the interests of customers are safeguarded,” CBK said.
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.
The growth of the regulated sector has also been matched by an increase in the amount of credit being issued through the platforms.
CBK said regulated digital credit providers had issued 9,596,509 loans valued at Sh165.1 billion as of August 2026.
The latest licensing exercise comes as CBK continues efforts to bring more digital lenders under its supervision amid concerns over the practices of providers operating outside the regulatory framework.
The regulator said the decision to license and oversee digital credit providers had been “precipitated by concerns raised by the public about the predatory practices of the unregulated DCPs”.
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 said the licensing process for other applicants was still ongoing, with many firms at different stages of review and some yet to provide required documents.
“We urge these applicants to submit the pending documentation expeditiously to enable completion of the review of their applications,” CBK said.
CBK 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.