The Kenya Bankers Association (KBA), which promotes the interests of its 43 member banks, and the Central Bank of Kenya (CBK) are reportedly working on possible regulation changes that would allow microfinance institutions (MFIs) to access customer data at the country’s Credit Reference Bureau. Some MFI Representatives argue that their lack of access to the bureau exposes them to the risks of lending to individuals and businesses that have previously defaulted on their loans.
After expanding credit bureau access to MFIs, the next step would be to include savings and credit cooperatives (SACCOs) in the system. SACCOs are owned, governed and managed by their members who have a common bond such as working for the same employer, belonging to the same church, or living or working in the same community.
By Jennifer Young, Research Associate
About the Kenya Bankers Association:
Established in 1962, the Kenya Bankers Association (KBA) promotes the interests of its 43 member banks by engaging the government and the sector regulator, Central Bank of Kenya (CBK). The association has undertaken initiatives such as aligning standards for the industry; modernizing payments systems; and establishing an automated clearing house, which it operates in conjunction with the Central Bank of Kenya.
About the Central Bank of Kenya:
Established in 1966, the Central Bank of Kenya is the country’s central banking authority. A Microfinance Act passed in 2008 paves the way for the licensing of deposit-taking microfinance institutions (DTMs). Professor Njuguna Ndung’u was appointed Governor of Central Bank in March 2007 and continues to serve in that capacity as of April 2012.
Sources and Additional Resources:
CapitalFM Kenya News Story: “Credit Reference Bureau to Share Data with MFIs.”
http://www.capitalfm.co.ke/business/2012/09/credit-reference-bureau-to-share-data-with-mfis/
MicroCapital Story: “MICROCAPITAL BRIEF: Grameen Foundation, KfW Bankengruppe, Access Africa Fund Invest in Mobile Microfinance Institution Musoni Kenya”, May 23, 2012.
https://www.microcapital.org/microcapital-brief-grameen-foundation-kfw-bankengruppe-access-africa-fund-invest-in-mobile-microfinance-institution-musoni-kenya/
MicroCapital Universe Profile: Kenya Bankers Association
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=kenya+bankers+association
MicroCapital Universe Profile: Central Bank of Kenya:
https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Central+Bank+of+Kenya+%28CBK%29#Central_Bank_of_Kenya_CBK_
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