Digital lenders will once again be allowed to access and list Kenyans with the credit reference bureaus (CRBs) under a new proposed ‘digital lenders’ law.
Sent to Parliament, the National Assembly Committee on Finance and National Planning have recommended clearing digital lenders to access the credit information sharing (CIS) system in their report considering the 2021 Central Bank (Amendment) Bill.
This law follows lobbying by the coalition of digital lenders led by the Digital Lenders Association of Kenya (DLAK) and also the Central Bank of Kenya (CBK).
“The Committee agreed to the proposal so that the digital lenders are allowed to disclose any positive or negative information of its customers to the licensed credit reference bureaus. The information so provided must be, only that which is necessary for the discharge of the functions of the digital lenders and the licensed credit reference bureaus,” said the Committee which is led by Gladys Wanga.
“Many Kenyans lost the credit history reports that would enable them to obtain credit at lower risk-adjusted rates,” DLAK told the Committee in sittings while pushing for the return of digital lenders to the CIS system highlighting the role of CRBs in credit issuance.
Digital lenders had been barred from listing Kenyans with CRBs in April last year with the CBK citing the abuse of the credit sharing platform by the players.
DLAK says the value of loans disbursed monthly halved to just Sh2 billion on the backdrop of the freeze.
The lifting of the ban is likely to see the number of Kenyans listed with CRBs spike on the back of elevated loan defaults covering the pandemic period.
