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40 digital lenders in Kenya being probed over misuse of personal data


The Office of Data Protection Commission (ODPC) is investigating 40 digital lenders over allegations of abuse of personal data.

The ODPC launched investigations after receiving numerous complaints from members of the public.

“The ODPC wishes to notify the public that it is conducting preliminary documentary assessment and audit on 40 Digital Credit Providers (DCPs) whose practices regarding the processing of personal data have been raised to the Data Commissioner as complaints by various members of the public,” it said in a statement.

The regulatory office established in 2020 has been playing a crucial role in ensuring organizations and government institutions treat personal data with safety and caution.

The Commission says it had received 1030 complaints as of September 30, and 555 of them had been admissible. About 299 of these cases were on digital lenders.

The Data Protection (Complaints Handling and Enforcement Procedures) Regulations, 2021 took effect in February 2022 paving the way for data subjects to file complaints and report data breaches to the Data Commissioner.

The affected digital lenders will undergo an audit process, with the ODPC requiring that they submit requisite documents by October 18, 2022 failure to which they will be deemed to have failed to cooperate with the Office,  an offence under Section 61 of the Act.

“This is just one among many other complaints being investigated by the office. We want to assure the public that the complaints received will be investigated and concluded accordingly,” says the ODPC.

The affected digital lenders include:

Branch

Tala

APESA,

ASAPKASH,

Cash Sea,

Collectplus,

Coopesa,

Credit Kes,

Credit Moja,

Deltech Capital Limited,

DIRECT CASH,

Lioncash,

M-Credit

Metaloan

Mokash,

PAPCASH,

POCKET CASH

Zash loan,

Zenka Digital Limited

Zuri Cash.

Fairkash.

Flashpesa,

Flexi Cash,

Hela Credit,

Hikash,

IKASH Connect

Instarcash

IPESA

KASH LOAN

KASHBEAN

KASHPLUS

KASHWAY

KESLOAN

LEMON KASH

PREMIER CREDIT LTD,

ROCKET PESA,

Senti,

Skypesa,

Wakanda Credit

The probe comes just a few weeks after the Central Bank of Kenya (CBK) directed all unregulated lenders in the country to close shop.

Kenya is home to more than 200 digital lenders that are providing people with easy access to loans of various amounts. Over the last few months though, the lenders have come under attack from the regulator, the Central Bank of Kenya (CBK) with some being accused of operating in the country without a proper licence.

In March this year, CBK went ahead and published new regulations requiring all digital lenders to get a license within six months or cease their operations by September 2022. Previously, the lenders were only required to register the businesses to run their operations in the country.

CBK said it received 288 applications since March 2022 and has worked closely with the applicants over the last six months in reviewing their applications.

The licensing and oversight of the digital lender was precipitated by concerns raised by the public about the predatory practices of the unregulated DCPs, and in particular, their high cost, unethical debt collection practices, and the abuse of personal information.

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Simon W Nderitu

Simon is a tech enthusiast who keeps a close eye on emerging technologies, startups and the general business environment. You will often catch him totally immersed and drooling over Artificial Intelligence, Machine Learning, Virtual Reality, Augmented Reality, IoT and just about any other tech that promises to revolutionize the way we live. Send tips to snderitu@techtrendske.co.ke

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