CBK licences 10 digital lenders as scrutiny of 278 others continues
The Central Bank of Kenya has so far approved 10 Digital Credit Providers of the 288 applications they received in accordance with CBK Act 2022 regulations on digital lending.
CBK has so far approved the applications of Cere Tech Limited, Getcash Capital Limited, Giando Africa Limited trading as Flash Credit Africa, Jijenge Credit Limited, Kweli Smart Solutions Limited, Mwanzo Credit Limited, MyWagepay Limited, Rewot Ciro Limited, Sevi Innovation Limited, and Sokohela Limited.
In March this year, CBK gazetted the digital lenders' regulations paving way for their oversight and supervision. All digital lenders were to apply for licenses from the banking regulator before September 17th.
“The Regulations are now operational, all previously unregulated DCPs are required to apply to CBK for a license within six months of the publication of the Regulations, or cease operations,” CBK said in March.
The rapid growth of mobile lending necessitated the regulations that among other things sought to address high-interest rates, unethical debt collection practices, and the misuse of personal data by some digital lenders.
Companies seeking licensing have to among other things issue evidence and sources of funds invested or proposed to be invested in the business and demonstrate that the funds are not proceeds of crime, the proposed digital credit provider’s Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) policies and procedures and the proposed digital credit provider’s data protection policies and procedures.
In the new regulations, digital lenders will apply to CBK for approval of interest rates on their loans, disclose all terms of their credit to borrowers, and have also been barred from sharing information of loan defaulters with third parties.
Digital lenders have been blamed for breaching the confidentiality of information of borrowers who default on loans and hiding the terms of their loans, opening an avenue for predatory lending.
Governor Njoroge said at the time that the regulations will bring sanity into an industry that has for years been blamed for predatory lending and debt-shaming borrowers in a bid to recover defaulted loans.
None of the big names in mobile lending such as Tala and Branch has been approved yet.
As the process of verification continues, we expect more companies to be approved as the CBK chases down its 60 days timeline for verification and licensing of digital lenders.
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Nine steel manufacturers slapped with record Sh338.8M fine for market distortion
The Competition Authority of Kenya has slapped nine steel manufacturers with a record Sh338.8 million fine for market distortion and price collusion.
According to the competition watchdog, the nine companies have been penalised for artificially inflating the prices of steel products.
The companies and their fines include Corrugated Steel Ltd (Sh86.9 million), Tononoka Rolling Mills Ltd (Sh62.7 million), Devki Steel Mills Ltd (Sh46.3 million), Doshi and Hardware Ltd (Sh41.6 million), Jumbo Steel Mills (Sh33.1 million) and Accurate Steel Mills Ltd (Sh26.8 million).
Others are Nail and Steel Products Ltd (Sh22.8 million), Brollo Kenya (Sh9.4 million) and Blue Nile Wire Products Ltd (Sh9.16 million).
CAK said investigations into the steel sector commenced in August 2020 when the Authority began collecting intelligence on pricing and output restriction.
The Authority's Acting DG Adano Wario said the penalties on the firms are proportional to the offense, specifically harming consumers who are grappling with the high cost of building materials in the country.
"Cartels are conceived, executed and enforced by businesses to serve their commercial interests and to the economic harm of consumers," Wario said.
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Kamau Thugge officially assumes office as 10th governor of the CBK
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Thugge takes over from former governor Patrick Njoroge, who has completed two terms, each lasting four years. With a wealth of experience from his distinguished career in international and Kenyan public service, Thugge has made significant contributions to shaping economic policies and initiatives.
Having worked at the International Monetary Fund (IMF) and held various senior roles in Kenya's National Treasury, Thugge brings valuable expertise to his new position.
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