The Central Bank of Kenya (CBK) has proposed new regulations for digital lenders across the country to clear up legal confusion.
According to the regulator, the move is part of its ongoing efforts to strengthen oversight of the fast-growing non-deposit credit market.
Therefore, the proposed Non-Deposit Taking Credit Providers Regulations, 2025 are now open for public comment.
The draft rules seek to replace and expand on the Digital Credit Providers (DCP) Regulations, 2022, which were introduced to curb unethical practices by unregulated digital lenders.
These included exorbitant interest rates, harassment of borrowers, and misuse of personal data.
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Why the New Rules?
The Central Bank of Kenya has noted that while the licensing of 126 digital credit providers since 2022 has marked progress, key challenges remain around legal clarity and regulatory effectiveness.
The 2024 amendment to the CBK Act through the Business Laws (Amendment) Act replaced the term “Digital Credit Providers” with “Non-Deposit Taking Credit Providers.”
The move was meant to broaden regulatory coverage and eliminate misinterpretations of the law by lenders and the public.
“Whilst great progress was achieved in the regulation and supervision of DCPs, including the licensing of 126 DCPs to date, many challenges continued to affect the effectiveness of the legal and regulatory framework,” CBK said in a public notice.
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Why CBK Introduced the Original Regulations
The original Digital Credit Providers Regulations of 2022 were introduced to address concerns about predatory lending.
Further, the regulator received complaints over high interest rates, misuse of personal data, and unethical debt collection tactics.
However, the Central Bank of Kenya stated that the 2022 framework had limitations, especially as more digital lenders emerged with increasingly complex business models.
Therefore, the proposed 2025 regulations are designed to give CBK more powers to regulate credit providers that do not take customer deposits but offer loans through digital platforms and other channels.
Additionally, it aims to better align the legal framework with consumer needs, financial stability goals, and Kenya’s evolving fintech landscape.
To promote transparency and public participation, the notice is calling on industry stakeholders, civil society groups, financial institutions, and the general public to submit comments on the draft regulations by Friday, September 5, 2025.
Moreover, the development is expected to streamline Kenya’s digital credit market, ensuring better protection for borrowers and strengthening CBK’s ability to monitor non-traditional financial service providers.
Submissions for comments can be sent through email to [email protected] or by post to the Director, Bank Supervision Department, Central Bank of Kenya, P.O. Box 60000 – 00200, Nairobi.
The full draft regulations are available on CBK’s website: https://www.centralbank.go.ke.
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