Tala among twelve digital lenders to secure license from CBK

PHOTO | Courtesy

The Central Bank of Kenya (CBK) has issued license to twelve more digital credit providers as more await clearance to rollout their services.

This now brings total number of licesed digital lenders to 22 with the big players such as Tala also being granted operating license.

In September last year, CBK licensed 10 digital credit providers after the enactment of Digital Credit Provider Regulations 2021.

"CBK has received 381 applications since March 2022 and has worked closely with the applicants to review their applications. Additionally, CBK has engaged other regulators and agencies pertinent to the licensing process including the Office of the Data Protection Commissioner (ODPC).

Firms handling consumer data are required by law to register with the ODPC as either data processors or controllers before being issued with a license.

Tala which leads in mobile lending with more than Ksh 2 billion of credit issued since 2014 has not been in operation since September last year.

During the waiting period, the lender said loan repayments among customers remained steady.

"Luckily we did not see a direct impact on our credit repayment metrics. The waiting period however naturally had an impact on confidence in the industry with stakeholders and consumers, which is unfortunate, and Tala worked hard to sensitize our customers and stakeholders on the facts and the process over the last few months," said Annstella Mumbi, Tala Growth Director.

This comes as Tala announced an increase in loan limit to Ksh 50,000 from Ksh 30,000 while retaining its credit terms.

"This new development does not mean a change in credit terms for consumers as we will be continuing to offer our core credit product as is currently," added Mumbi.

According to CBK, issuance of license to the digital lenders is pegged on their business model, consumer protection, and fitness and propriety of proposed shareholders, directors and management.

This is further expected to safeguard consumer interest according to the regulator.

CBK says other applicants are at various stages of submitting necessary documents as required by the regulations.

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

Among licensed digital credit providers licensed Monday include Jumo Kenya, Letshego Kenya, MFS Technologies, M-Kopa Loan, Mycredit Kenya, Natalie Tech, Ngao Credit, Pezesha Africa, Tanakata Enterprises, Zanifu Limited and Umoja Fanisi Limited.