Since April 2020, millions of Kenyans were locked out of accessing loans by mobile lending apps, after the Central Bank of Kenya (CBK) denied them access to Credit reference Bureaus (CRBs) information.
Some apps even exited the Kenyan market, while others returned after a short while, citing a difficult working environment.
With time, some mobile lenders came back, but this time only lending to a section of customers considered to have a good repayment record.
“We stopped lending in March through April and May (2020) but we had to make decisions so we wrote off all bad loans. We are currently only lending to the best customers, those who understand that they have to pay,” said Digital Lenders Association of Kenya (DLAK) chairman Kevin Mutiso.
“Most borrowers initially were borrowing with no intention to pay back”.
Currently, the lenders are pushing to have a bill passed in Parliament that will allow them to list defaulters with CRBs, after which they will open doors for all borrowers.
90 percent of those listed with CRBs took loans from mobile lenders.
As of August 2020, there were only 39 banks, 14 microfinance banks, 1,353 unregulated saccos and 164 regulated saccos that could list borrowers with CRB.