Digital lenders top Kenya’s consumer complaint list despite reforms

Complaints against Kenya’s digital lenders have risen sharply despite tighter regulation of the sector, suggesting consumer protection concerns persist three years after the Central Bank of Kenya (CBK) was empowered to supervise the fast-growing industry.

The Competition Authority of Kenya (CAK) said in its annual report that complaints against digital lenders climbed to 355 in the year to June 2025, from 67 a year earlier.

The increase made digital lenders the largest source of consumer complaints in financial services, accounting for nearly two-thirds of the sector’s grievances, reinforcing concerns that rapid growth in app-based lending continues to outpace improvements in market conduct.

The authority said the complaints were largely related to misleading representations, undisclosed charges, and unilateral changes to loan terms.

“This sector has, over the years, continued to record a high number of cases,” the competition watchdog said, attributing the trend to the rapid expansion of digital lending platforms that have widened access to credit while generating “violations of consumers’ welfare provisions”.

“The main consumer infringements included false and misleading representations and unconscionable conduct.”

Kenya amended its laws in 2022 to place digital credit providers under the CBK’s supervision, following years of complaints about high borrowing costs, misuse of borrowers’ personal data, and aggressive debt collection practices. Before then, hundreds of lenders operated outside the regulatory framework.

The latest figures suggest the licencing regime has yet to eliminate disputes between lenders and borrowers, even as more firms move into the regulated market.

The financial services sector accounted for 564 of the 915 consumer complaints…