CBK enters agreement with Google to ban credit providers
CBK-Central Bank of Kenya enters an agreement with Google to ban unregistered credit providers on their platform.
A deal between the Central Bank of Kenya (CBK) and Google will result in the removal of unregistered mobile lending apps from the Google Play Store, dealing a severe blow to online credit providers.
This action follows CBK’s decision to license just ten digital credit companies, effectively banning the remaining 288 from the market as the regulator works to impose discipline.
“Currently we only accept declarations and licenses from entities published under the Directory of Digital Credit Providers on the official website of the CBK,” Google said.
The CBK said that only 10 digital lending companies in Kenya had received licenses as part of its plan to regulate the sector.
The deadline for submitting a license application for the Digital Credit Providers (DCPs), sometimes referred to as digital lending companies, was September 17, 2022.
According to a March notice from CBK, the digital lending companies had six months to submit their licensing applications.
If the companies do not submit applications for or get the aforementioned licenses, they are unable to legally conduct business.
Players like Tala, Haraka, and Okash may be impacted by Google’s decision. A month after the law governing digital lending was passed, Branch became the first mobile digital lender to purchase the majority of a banking organization.
“You’ll have at least 30 days from the date of this notification to update your app to comply with the following policy changes,” the search engine giant noted.
According to Google, companies that are not directly engaged in money lending activities and are only providing a platform to facilitate money lending by registered DCP(s) to users, will need to provide a copy of the DCP license of their respective partners.
The pushback by the regulator came after public outcry over the abuse of customer data by digital credit providers, some calling relatives, and friends to compel borrowers to pay up their loans.
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