Some digital lenders are back to their old aggressive and intrusive debt collection tactics, barely three years after regulations were introduced to curb such practices.
The rogue group is back to the notorious predatory debt collection practices such as debt-shaming whereby they deploy tactics that publicly humiliate or embarrass borrowers who have defaulted on their loans.
This practice often involves sharing private information about the borrower's debt with their contacts, such as family, friends, or employers, to pressure them into repaying the loan.
A spot-check by the Business Daily has confirmed a fresh surge in cases where debt collectors working for digital credit providers (DCPs) are harassing those on the contact lists of loan defaulters with the hope of recovering bad loans.
One such firm is Chapeo Capital, which operates mobile lending apps such as ZKPesa, Chapeo Cash, and Chapeo Credit. The company has been bombarding individuals with calls and text messages urging them to pressure their contacts to repay loans.
“Your contact *** has an unpaid loan of Sh1,720 due for 7 days, despite several reminders. This is business money, and prompt payment is expected. Please urge them to pay NOW,” read a text message received by a staff of Business Daily.
He received several such messages within nine days, followed by an abusive phone call from an agent of Chapeo Capital on Tuesday, June 24, 2025, who demanded that the defaulter settle the loan.
The matter was reported to the Central Bank of Kenya (CBK). Chapeo did not respond to repeated requests for comment. All of its listed contacts at the CBK were switched off, and an email inquiry went unanswered.
Licensed in March 2024, Chapeo has operated legally for just over a year but now appears to be violating the terms of its licence, which require full compliance with Kenya’s data protection and digital lending laws.
The CBK (Digital Credit Providers) Regulations, 2022 explicitly prohibit the use of threats, harassment, obscene language, or unauthorised access to a customer’s contact list during debt collection.
The rules also ban digital lenders—and their agents or officers—from contacting a borrower’s acquaintances.
Chapeo is not alone. Other digital lenders named in recent complaints include Whitepath, Rocketpesa, Platinum Credit, Azura Credit, Mulla Pride, and Credit Watch Investments. All have been accused of debt-shaming practices, some of which have led to regulatory warnings and fines.
The Office of the Data Protection Commissioner (ODPC), which oversees the enforcement of data protection laws, relies on individual complaints from affected persons to initiate action.
It has powers to penalise firms, order enforcement, and recommend prosecution of directors — but not to revoke a lender’s licence.
That power lies with CBK, which can suspend or revoke licences if a digital lender violates licensing conditions or contravenes Kenyan law.
To date, the CBK has licensed 126 digital credit providers, including several that have been linked to ongoing debt-shaming violations.
Over 600 others have applied for the licence and are awaiting CBK’s confirmation.
Kevin Mutiso, chairman of the Digital Financial Services Association of Kenya (DFSAK), acknowledged that some members are flouting the rules, and said the lobby is working with regulators to take action.
“We know that the few breaking the law are spoiling the name of the entire industry,” he said. “We’re supporting affected customers to get justice quickly, and we’re also working with regulators to assess the actions of those lenders.”
Mr Mutiso added that several violators are currently under scrutiny by both the ODPC and CBK, and could soon face sanctions.
