Kenya's banking and finance sector moves faster than almost any other area of commercial law in the country, conventional bank lending sits alongside a booming digital credit market, new movable property security rules, and, as of late 2025, an entirely new legal framework for virtual assets. Our firm advises banks, microfinance institutions, digital lenders, fintechs, and borrowers through this landscape, combining deep knowledge of the established legal framework with genuine fluency in the newest regulatory developments most firms have not yet caught up with.
Banking and finance law in Kenya sits across a wider set of statutes than most people expect. The Banking Act, Chapter 488, defines banking business and governs licensed banks directly. The Central Bank of Kenya Act establishes the CBK's regulatory authority over monetary policy and the banking sector generally, extended significantly by the Central Bank of Kenya (Amendment) Act, 2021, which for the first time brought digital lenders under formal CBK oversight. The Microfinance Act governs microfinance banks specifically, distinct from conventional commercial banks. The Movable Property Security Rights Act modernized how security over movable assets, equipment, inventory, receivables, is created and enforced, replacing the older chattels transfer regime with a more comprehensive framework. The National Payment System Act governs payment service providers, directly relevant given how much of Kenya's financial activity now moves through mobile money rather than traditional banking channels. The Consumer Protection Act, 2012 governs credit agreements and disclosure obligations owed to borrowers. And, as of October 2025, the Virtual Asset Service Providers Act introduces Kenya's first dedicated regulatory framework for cryptocurrency and virtual asset businesses.
Lending and Loan Documentation. We advise lenders and borrowers on bilateral and syndicated lending, project and infrastructure finance, asset and equipment finance, trade and supply chain finance, and acquisition finance, drafting and negotiating loan agreements that protect our client's position on either side of the transaction.
Secured Transactions. We advise on the creation, perfection, and enforcement of security, debentures, charges over land, share charges, chattels mortgages, and guarantees, under the Movable Property Security Rights Act and related legislation, ensuring security interests are properly registered and genuinely enforceable if a borrower defaults.
Digital Lending and Fintech Compliance. Kenya's digital credit market has grown rapidly, and so has its regulation. We advise digital credit providers and fintech lenders on licensing under the Central Bank of Kenya (Digital Credit Providers) Regulations, 2022, building compliant credit policies covering eligibility, disclosure, and debt collection practices, and navigating the Business Laws (Amendment) Bill's 2025 reforms, which specifically prohibit harassment and abusive debt collection tactics by microfinance and digital lenders.
The In Duplum Rule and Interest Disputes. Section 44A of the Banking Act caps accumulated interest and penalties at the original loan amount once a defaulted loan's outstanding interest equals the principal, a protection commonly known as the in duplum rule. We advise both lenders structuring compliant loan terms and borrowers who believe this protection has been breached, an increasingly active area given growing regulatory and consumer scrutiny of excessive interest charges.
Virtual Assets and Cryptocurrency Regulation. Kenya's Virtual Asset Service Providers Act, 2025, assented to in October 2025, creates the country's first formal licensing and compliance framework for cryptocurrency exchanges, wallet providers, and other virtual asset businesses. This is genuinely new legal ground, and our firm is positioned to advise businesses entering this space on licensing, compliance, and structuring from the outset, rather than retrofitting compliance after the fact.
Regulatory Licensing and Compliance. We advise banks, microfinance banks, digital lenders, and payment providers on Central Bank of Kenya licensing applications, prudential compliance, and ongoing regulatory reporting obligations.
Debt Recovery and Enforcement. We represent lenders in recovering outstanding debts and enforcing security, and represent borrowers facing unfair or aggressive collection practices, including conduct that may breach Consumer Protection Act disclosure requirements or the newly strengthened protections against harassment.
Anti Money Laundering Compliance. We advise financial institutions and other regulated businesses on compliance obligations under the Proceeds of Crime and Anti Money Laundering Act, including customer due diligence and suspicious transaction reporting requirements.
Payment Systems and Mobile Money. We advise payment service providers on compliance with the National Payment System Act, relevant to Kenya's mobile money and digital payments ecosystem specifically.
Few areas of Kenyan commercial law have moved as quickly in the past five years as banking and finance. Digital lending went from largely unregulated to a formal CBK licensing regime in the space of a single amendment act. Movable property security moved from an outdated chattels transfer system to a modern, internationally aligned framework. Virtual assets went from entirely unregulated to a dedicated statute in 2025. A lender, borrower, or fintech operating in this space needs counsel that is actively current with these changes, not applying an understanding of the law as it stood even two or three years ago.
Our banking and finance practice represents both sides of financial transactions, commercial banks, development finance institutions, microfinance banks, and digital lenders on one side, and corporate borrowers, SMEs, and individual guarantors on the other. We also advise fintech companies and virtual asset businesses navigating Kenya's newest regulatory frameworks, and businesses of any size that need properly structured, enforceable security arrangements for financing they extend or receive.
We start by understanding the actual commercial transaction or regulatory question at hand, then apply the specific statutory framework that genuinely governs it, conventional banking law, the digital credit regime, movable property security, or the new virtual asset framework, rather than generic commercial advice disconnected from how these sectors are actually regulated today. Where a matter touches genuinely new legal ground, as much of the digital lending and virtual asset space still does, we bring the same rigor to structuring sound compliance from the outset that we would bring to a matter under long established law.
What is the in duplum rule and how does it protect borrowers? Under Section 44A of the Banking Act, once accumulated interest and penalties on a defaulted loan equal the original principal amount, further interest is capped. This prevents debt from growing indefinitely beyond the original amount borrowed.
Do digital lending apps in Kenya need a license? Yes. Under the Central Bank of Kenya (Digital Credit Providers) Regulations, 2022, digital credit providers must obtain a license from the CBK to operate lawfully, and must comply with disclosure, conduct, and reporting requirements.
Is cryptocurrency legal in Kenya? Kenya's Virtual Asset Service Providers Act, 2025 establishes a formal licensing and regulatory framework for virtual asset businesses, moving the country from an unregulated environment to one with defined compliance obligations for exchanges, wallet providers, and related businesses.
What security can a lender take over business assets in Kenya? Depending on the transaction, this can include a debenture over company assets generally, a charge over land, a share charge, or a chattels mortgage over specific movable property, each governed by its own registration and enforcement requirements under the Movable Property Security Rights Act and related law.
Can a digital lender in Kenya harass me over an unpaid loan? No. Recent reforms under the Business Laws (Amendment) Bill specifically prohibit harassment and abusive debt collection practices by microfinance and digital lenders, and borrowers facing this kind of conduct have grounds to pursue a complaint or legal action.
What is the difference between a conventional bank and a microfinance bank under Kenyan law? They are governed by separate statutes, the Banking Act for conventional banks and the Microfinance Act for microfinance institutions, with different licensing and regulatory requirements reflecting their different scale and customer base.
Whether you are structuring a lending transaction, securing financing, navigating digital lending compliance, or entering Kenya's new virtual asset regulatory landscape, our banking and finance team brings the depth and current knowledge this fast moving sector demands.
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