Kenya’s digital credit market continues to evolve at pace. As of April 2026, the Central Bank
of Kenya (CBK) had licensed 259 Digital Credit Providers (DCPs) from more than 800
applications, underscoring the increasingly rigorous licensing framework. At the same time,
the sector has recorded significant growth, with over KES 133.5 billion in digital loans
disbursed to approximately 7.5 million active borrowers by February 2026. Looking ahead,
inflationary pressures driven by global geopolitical developments, increased private sector
borrowing and revised risk-based lending models are expected to increase demand for
digital credit, while also heightening regulatory and operational risks for DCPs.
Against this backdrop, compliance remains a strategic priority. In addition to the licensing
framework under the Central Bank of Kenya Act and the evolving regulatory regime for
non-deposit taking credit providers, DCPs must navigate a broad range of legal obligations
under consumer protection, data protection, tax and contract law. Regulatory scrutiny has
also intensified around lending documentation, pricing transparency, debt collection
practices, data governance, credit reporting and the use of customer information. As
enforcement activity continues to increase, providers should ensure that their contractual
documentation, governance frameworks and compliance programs remain aligned with
current legal and regulatory expectations.
Our recent compliance series highlighted a number of recurring risks affecting the sector,
including licensing deficiencies, data breaches, unlawful debt collection practices, interest
and pricing non-compliance, unenforceable contractual terms, employment-related
disputes, anti-money laundering gaps and inadequate crisis response planning. We also
examined emerging trends shaping the market, including evolving licensing requirements,
stronger consumer protection enforcement, developing jurisprudence, increased market
consolidation and greater product diversification. These developments reinforce the need
for DCPs to adopt proactive compliance strategies that not only satisfy regulatory
requirements but also support sustainable growth and enhance consumer confidence.
Our Financial Services, Consumer Protection and Dispute Resolution teams continue to
advise digital lenders, fintech businesses, financial institutions and investors on licensing,
regulatory compliance, governance, investigations, enforcement actions, consumer
disputes and financial services litigation. If you would like to discuss the implications of these
developments for your business, please contact a member of our team.

This publication is intended for general information purposes only and does not constitute legal advice. It should not be relied upon as a substitute for specific legal advice on any particular matter. Regulated entities should seek independent legal counsel on the application of the frameworks described herein to their specific circumstances.

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