DEBT RECOVERY -vis-à-vis- DATA PROTECTION Part 1B
March 20, 2025REDRESS & RECOURSE TO THE DIGITAL LENDING COMPANIES AS DATA PROCESSROR OR THE DATA CONTROLLER
March 21, 2025DEBT RECOVERY -vis-à-vis- DATA PROTECTION Part 1C
Author
Joy Ruguru Kabuchoru
From the legal insight 1a, and 1b it is evident that as a law-abiding Kenyan Citizen, one has to brace themselves with the legal jurisprudence. Remember, ignorance of the law does not save the indolent. In an effort to circumvent the breach of personal data, in today’s legal insight, we will layout the legal redress and recourse that are available to the data processor or the data controller in relation to recovery of debts.
The jurisprudence of debt recovery by digital lending companies in Kenya is rapidly evolving. Notably, before 2022, the loophole of unspecific regulations left borrowers vulnerable to unfair and abusive practices. However, through a Legal Notice Number 46 of 2022, - Digital Credit Providers Regulations of 2022, the Central Bank of Kenya introduced significant protection for borrowers. The Office of the Data Protection has also gone ahead and released a Guidance
Note for Digital Credit Providers. However, there is a caveat on the same as the guide is not a replacement of the actual law it only serves as a guidance serves as a roadmap for the digital credit providers on:-
- how to responsibly handle personal data while abiding with the provision of the Data Protection Act, 2019; and
- the regulations set forth by the Office of the Data Protection Commissioner.
Other than the Digital Credit Providers Regulations, 2022 by the Central Bank of Kenya the regulatory body further through the Banking – Credit Reference Bureau Regulations, 2020 highlight their raft of measures. Noting keenly, the Digital Credit Providers Regulations, 2022 do not provide for a procedure of debt collection by the digital lending companies but the do nots .
In light of this legal insight, some of the remedies to the borrowers are:-
- lodging a complaint with the digital service providers;
- report unfair and / or illegal debt collection practices the Central Bank of Kenya for investigation;
- lodge a suit against the digital lending company for damages or injunctive relief. The injunctive relief can only be sought if the borrower has suffered harm due to unfair debt collection practices; and / or
- lodge complaints before the Office of the Data Protection Commissioner if the digital lending company has breached their data privacy.
Thus, if found in such predicament and you wish to pursue a legal claim. Don’t look any further, you are in the right hands, just contact us.
