This archive report was first published on 26 July 2019.
On July 26, 2019, Central Bank of Kenya Governor Patrick Njoroge expressed concerns about mobile lenders, suggesting they might be involved in money laundering schemes.
At a press briefing, Njoroge compared mobile lending platforms to 'your typical money laundering schemes', which he said pose a serious threat to the country's financial health.
He emphasized the need for regulation, stating that digital lenders have to be put under a different regime from that of commercial banks.
Some digital lending platforms have reportedly raised funds from the Silicon Valley, with Branch, for example, raising Sh7 billion to deepen its ability to meet the rising demand for mobile loans.
Njoroge urged lawmakers to come up with regulations for the digital lenders, citing the lack of regulation as a 'huge lacuna in law'. He also requested commercial banks to label their mobile loan products as 'approved by CBK' to differentiate them from those of unregulated financial institutions.
There are currently over 25 digital credit providers, and the lenders under the Digital Lenders Association have defended themselves against such accusations, saying they are open to regulations.
