Standard Chartered Bank Kenya plans to launch a mobile lending service as it eyes a bigger share of the expanding digital credit market.
The lender said it has already received Central Bank of Kenya (CBK) approval after addressing data privacy concerns that held back rollout of the platform.
StanChart is banking on the new mobile platform, which was first announced in mid-2021, to grow and diversify its products, especially the affluent individual and corporate segments that are the most profitable for the bank.
“By the end of this month we should go live. We are now doing internal testing,” Stanchart Kenya chief executive Kariuki Ngari said.
The lender has, however, said the mobile loan app will not be a route to penetrate the mass market, but will instead be an avenue to ease congestion at branches from borrowers.
Digital lenders have been accused of accessing borrowers’ private mobile data and using it in determining whether to lend and the rates to charge. Following these widespread accusations, The Central Bank of Kenya instituted tighter regulations for digital lenders.
Stiff penalties have also been stipulated under Data Protection Act against sharing of information with third parties without consent. The law accords individuals the right to be told when their data is being shared and for what purposes.
“It was all about AML [anti-money laundering] and compliance issues that came about…in terms of what data can you use to inform the credit decision,” said Mr Ngari.
“Now it is different. We will use very different sources of data, where the credit reference bureau is going to be key for instance. It’s about using alternative sources of data that are compliant.”
StanChart will be joining lenders such as KCB which runs KCB-M-Pesa, Equity (Equitel), NCBA (M-Shwari), Co-op (MCo-op Cash) and Absa Kenya (Timiza) when it rolls out its mobile credit offering.