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Data Commissioner Launches Investigations into Handling of Data by Mobile Loan Apps

Immaculate Kassait [Photo/Courtesy]

Mobile money lending apps often require a lot of permissions upon sign up ranging from phone contacts, location and access to messages.

In addition to this, users are also required to provide details with information such as salary, next of kin and job specifications.

The Data commissioner’s office has now launched investigations into a number of digital lending apps accused of sharing borrowers’ confidential data.

Read: Why Mobile Loan Apps Are Nolonger Lending To Some Customers

According to the Data Commissioner, Immaculate Kassait, the office has received multiple reports regarding breach of data by the mobile lending apps.

It is alleged that the lenders resort to debt shaming borrowers in an effort to recover loans. Tactics used include contacting friends and family of the borrower or threatening to tell their employers.

The Data Protection Act prohibits sharing of confidential information without Consent. Individuals also have a right to be told when and why their data is being shared.

Read: Unpaid Mobile Loans Hurting Kazi Mtaani Beneficiaries

“The Office received complaints from data subjects regarding digital money lending applications. Towards this end, my office has commenced investigations on a total of 67 such complaints in line with the office mandate,” Ms Kassait said.

Mobile money lending apps have become popular due to their quick loan model that allows borrowers to apply for and receive loans within a few minutes. However, many Kenyans have reported of frustrating debt collection experiences from the apps.

“Infringement of provisions of the Kenya Data Protection Act (DPA) will attract a penalty of not more than Sh5 million or, in the case of an undertaking, not more than 1 percent of its annual turnover of the preceding financial year, whichever is lower,” the Act says.

“Individuals will be liable to a fine not exceeding three million shillings or to an imprisonment term not exceeding ten years, or to both.”

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Written by Vanessa Murrey

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Data Commissioner Launches Investigations into Handling of Data by Mobile Loan Apps

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