Digital credit has emerged as a new and profitable service offering that has a great potential to increase financial inclusion. Yet, if it is not carefully managed, digital credit runs a great risk to exclude, over-charge, and create overindebtedness. Seven years since the first digital credit product launched, the market in Kenya has grown exponentially and hosts a diverse ecosystem with more than 50 supply-side actors. The expansion of digital credit in Kenya serves as a test-bed for the product and offers lessons for digital credit suppliers and regulators around the world.
During the first half of 2019, along with the Social Performance Task Force (SPTF) we commissioned MSC to study the current state of digital credit in Kenya and formulated recommendations for how to make digital credit delivery safer and more customer-centric. This study has been made possible through the generous contributions of Agence Française de Développement (AFD).
It examines the evolving challenges in digital credit and makes recommendations for more responsible and customer-centric product delivery.