No More Mobile Borrowing Due To CRB Freeze
Mobile phone lenders bar new borrowers who are not captured in their database from borrowing money due to CRB Freeze.
The Digital lenders have made a decision to only lend money to regular customers who are captured in their database, a move that will deny a majority of people short-term loans.
The decision was reached after the CBK barred the unregulated digital lenders, approximately more than 100, from blacklisting loan defaulters. Mobile lenders can only see the credit information of the borrower with their consent and CBK.
Kevin Mutiso the chairman of the digital lenders association said that there are only three million active borrowers in their database who can access the digital loans. The rest of the Kenyan population cannot access the loans.
New members are not given the loans as the lending firms cannot access their credit information due to the ban.
Digital lending firms cannot grow due to the self-imposed ban.
Mr Mutiso added that the digital lending firms which include, Tala, Zenka, Stawika, Okolea, Branch among many others will set new rules and bar new clients from borrowing because they do not have their clear records.
The CRB freezing was a result of digital lenders using it as a toy and blacklisting defaulters with less than one thousand shillings. The borrowers made several complaints because the unregulated digital lenders were misusing and sharing their credit information without their consent.
CBK was forced to issue guidelines on who to be blacklisted as a defaulter and ordered that blacklisted borrowers with fewer amounts be removed from CRB unconditionally.
The CRB freezing out move On digital lenders reduced the number of legible borrowers reduce from five million to about three million. Money lend out reduced to one billion from an average of four billion shillings per month.