(NAIROBI, KENYA) – Kenya’s digital credit market has reached a new regulatory milestone after the Central Bank of Kenya licensed 29 additional Digital Credit Providers, bringing the total number of regulated lenders to 281.
The latest approvals follow the licensing of 25 digital lenders in July 2026, as the regulator continues to formalise a sector that has grown rapidly over the past decade.
Data from the CBK shows that licensed digital lenders had granted 9,596,509 loans valued at KES 165.1 billion ($1.27 billion / GBP 0.96 billion) as of August 2026.
The regulator said it has received more than 900 applications since March 2022 and has been working with applicants to review their business models, consumer protection arrangements and the suitability of proposed shareholders, directors and management.
The review process is intended to ensure compliance with the law and safeguard customer interests, the CBK said in a statement.
“Other applicants are at different stages in the process, largely awaiting the submission of requisite documentation. We urge these applicants to submit the pending documentation expeditiously to enable completion of the review of their applications,” the banking sector regulator said.
Digital credit providers mainly carry out lending activities through digital platforms, including Unstructured Supplementary Service Data codes.
Loan products include education loans, development loans, short term personal loans, asset financing and business loans.
Kenya’s digital lending industry has its roots in the country’s mobile money revolution.
The first major digital credit product, M-Shwari, was launched on 27th November 2012 through a partnership between Commercial Bank of Africa, now NCBA, and Safaricom.
It allowed customers to save and borrow through their mobile phones, helping establish a new model of accessing formal credit without visiting a bank branch.
The model was subsequently followed by other bank and mobile money partnerships, including KCB M-Pesa, while independent digital lenders such as Tala and Branch entered the market around 2014.
The rapid growth of app based lending expanded access to credit, particularly for borrowers seeking relatively small amounts for emergencies, household needs and working capital.
However, the expansion also exposed regulatory gaps. Many non bank digital lenders operated outside direct CBK supervision, prompting complaints over expensive loans, aggressive debt collection and the use of borrowers’ personal information.
This led to the Central Bank of Kenya Amendment Act, 2021, which became effective on 23rd December 2021 and gave the CBK powers to license, regulate and supervise previously unregulated digital credit providers.
The Digital Credit Providers Regulations, 2022 were subsequently gazetted and operationalised on 18th March 2022.
The CBK began licensing digital credit providers in September 2022, with the first 10 providers approved under the new framework.
The number rose to 22 in January 2023 and 32 by March 2023 as the licensing programme gathered pace.
The scale of the sector has continued to grow under the licensing framework, with its contribution particularly visible in the small credit market.
The CBK’s Financial Sector Stability Report showed that digital credit provider loans had surpassed those of microfinance banks by December 2024, with most digital loans being below KES 20,000 ($154.05 / GBP 116.49).
By June 2025, digital credit providers had advanced KES 76.8 billion ($591.55 million / GBP 447.49 million) to the private sector.
The CBK said the short term nature of these loans makes them useful for emergencies and working capital for small businesses, although the relatively small amounts and short repayment periods limit their ability to finance larger investments.
Digital lending has also formed part of Kenya’s wider financial inclusion story.
The 2024 FinAccess Household Survey found that access to formal financial services and products increased to 84.8% from 83.7% in 2021, with mobile money remaining a key driver of inclusion.