Google has taken down hundreds of loan apps
from the Play Store in Kenya since its new policy, which requires digital
lenders in the East African country to submit proof of license, went into effect
in January, reports TechCrunch.
The policy came in the wake of Kenya’s Digital Credit
Providers (DCP) regulations last year, which required entities that provide
loans digitally to acquire a license to operate from the Central Bank of Kenya.
Google did not immediately respond to a request for
comment.
It was not immediately clear how many loan apps had been blacklisted, but a
spot check by TechCrunch today showed that nearly 500 apps previously in the
Finance category on Play Store, including MoKash and Okash, had been taken
down.
In early February, TechCrunch counted 657 apps in the
Finance category, which lists loans, banking, and investing apps amongst others.
Today, only 198 apps are listed in the category
By January, only 22 digital lenders had
received a license out of the 381 that applied, according to the Central Bank
of Kenya. These included Tala, a PayPal-backed loan provider; Pezesha, a
B2B embedded lending platform; and Jumo, which provides financial services,
including lending.
Google requires loan apps awaiting a license to submit a
declaration form attesting that approval is pending in order to obtain interim
approval, which will be valid for 45 days, to be listed on the Play Store.
Before the DCP regulations went into force, many of these credit apps used to
offer quick, unsecured personal or business loans; charge exorbitant interest
rates, apply debt-shaming tactics to recover their money, and share customer
data with third parties, taking advantage of lack of regulations and the
Play Store’s slack vetting process.
The regulations, meant to weed out rogue players, also
require loan apps to observe consumer privacy and data protection rights as
well as anti-money laundering laws. This is in addition to disclosing the terms
and pricing of loans to customers before approval and disbursement.