CBK Faces Pressure as Digital Lenders Call for Tougher Licensing Threshold Rules
A section of Kenya’s digital lenders is calling on the central bank to raise the licensing threshold to Sh50 million, aiming to filter out inactive operators and create a more credible, competitive credit sector while speeding up regulatory engagement.
A group of Kenya’s digital lenders is calling on the Central Bank of Kenya (CBK) to raise the licensing threshold for non-deposit-taking credit providers to Sh50 million, more than double the Sh20 million proposed in draft regulations.
The Digital Financial Services Association of Kenya (DFSAK) says a higher capital floor would discourage “briefcase operators” who obtain licenses but do little to advance credit.
“The reasoning is to separate the wheat from the chaff,” said DFSAK chairman Kevin Mutiso. “Many of the licenses issued are to entities that are not even doing business. This would separate players that are serious from those who are not.”
CBK’s draft rules, known as the Central Bank of Kenya (Non-Deposit Taking Credit Providers) Regulations, 2025, set a Sh20 million entry requirement for credit-only businesses. Firms that fall short of that bar can still register with the regulator but would need to upgrade to a license once they hit the threshold.
The regulations are designed to bring oversight to a wide range of businesses, including buy-now-pay-later schemes, hire purchase, peer-to-peer lending, and pay-as-you-go models.
So far, CBK has licensed 126 digital credit providers, while another 574 applications remain pending. Existing license holders will not need to reapply under the new rules.
DFSAK is also pushing for smoother engagement with the regulator. Lenders complain that CBK has been slow to respond to concerns, causing delays in capital allocation and product rollouts. They also warn of regulatory overlap, with some players being summoned by CBK, the Competition Authority of Kenya, and the Office of the Data Protection Commissioner.
“If we are paying an annual license fee to CBK, then we expect better relationship management with the apex bank because that is the right thing to do,” Mutiso added.
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