CRB Listing: Over 2.7 million mobile loan defaulters in Kenya can now breathe with ease. This is after the Central Bank of Kenya (CBK) released an order commanding lenders in Kenya not to list defaulters on CRB before six months.
This new order on CRB listing from CBK is expected to align mobile loans with normal bank loans in Kenya. It also means that borrowers will only be considered to have defaulted after six months. The notice, however, does not touch on mobile lenders who operate out of the ambit of the regulator and online usury that involves an estimated 500 players.
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“Among the challenges identified by the technical working group were the difficulties in applying the current data specification template to no traditional forms of credit such as digital loans,” said CBK Director of Banking Supervision Gerald Nyaoma in the circular.
A recent report by one of the CRBs indicated that more than 2.7 million Kenyans have been blacklisted for defaulting on mobile loans. Of these, more than 400,000 people have been blacklisted for defaulting on loans of Sh. 200 and below.
CBK has now given all banks, microfinance, and credit reference bureaus three months to start using the new template.
The template will classify non-performing loans as per prudential guidelines which state that any loan, which is past due more than 180 days, shall be classified as doubtful.
The financial institutions will have to forward customers’ information to CRBs on a daily basis to ensure the information is up to date and those who have resumed servicing their facilities are not listed as defaulters.
The reporting template has also been standardised so that analysis of data by the three licensed CRBs is the same so as to improve data acceptance rates.