Loan apps have been a menace to a lot of Kenyans. They had been acting illegally for an extended period and it took the complaints of thousands of locals, and bigger visibility from the media to prompt an action. To this end, the CBK developed a set of laws under the CBK Amendment Bill, 2021 to tame them. After it was signed, it meant that online lenders will be policed by the CBK.
Just the other day, we reported that only 10 loan apps had been approved to run their operations after they met the criteria set forth in the said law. You can find the entire list here. We also learned that there were under 300 loan apps that were in the review process. Those that did not feature in the list were told to stop running their operations immediately.
Another key development that has emerged today is that the Office of the Data Protection Commissioner (ODPC) will start conducting a preliminary assessment and audit on 40 online loan apps that have reportedly been misusing customers’ private information. These issues were raised by the public after more than 1000 complaints were raised.
“As of 30th September 2022, ODPC had received 1030 complaints, the office admitted 555 of these cases including 299 which were on Digital Lenders. representing 54 percent of all cases admitted,” says the ODPC in a statement.
To note, the Data Protection (Complaints Handling and Enforcement Procedures) Regulations, 2021 took effect in February 2022 paving the way for data subjects to file complaints and report data breaches to the Data Commissioner.
Here are the loan apps that will be investigated: Apesa Of Zerox Technology Cornpany Ltd, Asapkash Of Joyot Technology Limited, Branch, Cash, Cash Sea, Collectplus, Coopesa, Credit Kes, Credit Moja, Deltech Capital Limited/Mykes Loan, Direct Cash, Fairxash, Flashpesa, Flexi Cash, Hela Credit, Hikash, Ikash Connect, Instarcash, Ipesa, Kash Loan, Kashbean, Kashrus, Kashwa, Kesloan, Lemon Kash, Uoncashigrola Tech Ltd, Mcredit, Metaloan, Mokash, Papcash, Pocket Cash, Premier Credit Ltd, Rocket Pesa, Senti, Skypesa, Tala, Wakanda Credit/Xashway, Zash Loan, Zenka Digital Limited and Zuri Cas.
The ODPC adds that during the audit process, the said lenders will be required to provide requisite documents by October 18, 2022 failure to which they will be deemed to have failed to cooperate with the Office, which is an offense under Section 61 of the Act.
“This is just one among many other complaints being investigated by the office. We want to assure the public that the complaints received will be investigated and concluded accordingly,” says the ODPC.
According to the law, a digital lender shall put in place appropriate policies, procedures, and systems to ensure the confidentiality of customer information and transactions.
An online credit provider shall not share customer information with any person without the customer’s consent.