Kenya to Bring All Non-Deposit Lenders Under CBK Oversight

AFRICAN BUSINESS AND ECONOMYAugust 11, 2025 at 1:36 PM UTC

TLDR

Kenya’s Central Bank plans to introduce rules that will place all non-deposit-taking lenders under its supervision for the first time
Under the draft regulations, any credit-only provider with at least KES 20 million ($155,000) in capital, borrowings, or loan book must obtain a CBK licence
The changes will affect buy-now-pay-later firms, hire purchase operators, credit guarantors, peer-to-peer platforms, and pay-as-you-go lenders

Kenya’s Central Bank plans to introduce rules that will place all non-deposit-taking lenders under its supervision for the first time, closing regulatory gaps in the country’s fast-growing credit market.

Under the draft regulations, any credit-only provider with at least KES 20 million ($155,000) in capital, borrowings, or loan book must obtain a CBK licence. Smaller players will need to register with the regulator. Once gazetted, firms will have six months to comply.

The changes will affect buy-now-pay-later firms, hire purchase operators, credit guarantors, peer-to-peer platforms, and pay-as-you-go lenders. Licensed firms will face strict disclosure rules on ownership, funding sources, pricing models, credit risk policies, and data security.

Existing licensed digital lenders will not need to reapply, but pending applications will be reviewed under the new rules. The CBK says the overhaul will standardise lending practices, improve consumer protection, and prevent under-reporting of capital in a sector that has relied heavily on self-regulation.

Daba's newsletter is now on Substack. Sign up here to get the best of Africa's investment landscape

Key Takeaways

The CBK’s move marks the most sweeping change to Kenya’s credit-only market in years, potentially reshaping how over 700 lenders operate. By introducing a two-tier licensing and registration framework, the regulator aims to bring consistency to pricing, data protection, and complaint handling across both established and emerging credit providers. For consumers, the rules could curb opaque loan terms and improve dispute resolution. For lenders, compliance will require stronger governance, clearer documentation of funding sources, and formalised risk management systems. The reforms also align Kenya’s credit oversight with global trends where central banks are extending regulation to fintech lenders, ensuring market stability while guarding against money laundering and predatory lending. The shift could drive consolidation as smaller players weigh the costs of meeting CBK’s requirements against merging or exiting the market.

Kenya

Business

CBK

Lending

Banks

Digital Lending

Financial Services