A Directive by President William Ruto will see the Central Bank of Kenya abolish the blacklisting of borrowers and instead have a score method where defaulters will have a lower grade as opposed to being shut out from the financial system.
This comes even as the total value of non-performing loans by digital lenders is estimated at 30 billion shillings.
A 50% waiver on Digital loans owed will be granted provided a borrower pays the remaining 50% of the loan within the next 6 months.
According to the central bank, a majority of their defaulters are SMEs who are adversely affected by the covid-19 pandemic.
CBK adds that this framework will help those locked out of the system to borrow again.
President Ruto further said that the move was advised by Kenyans during the campaign period when they decried the high rates charged on digital loans when they failed to repay.