The Central Bank of Kenya (CBK) has invited members of the public to submit their views on the Draft CBK (Credit Guarantee Business) Regulations, 2025, a move expected to transform how credit guarantee institutions operate while placing them under formal regulatory oversight.
In a notice issued on Thursday, CBK explained that the regulations stem from the Business Laws (Amendment) Act, 2024, which amended the CBK Act to provide a legal framework for regulating and supervising credit guarantee businesses in Kenya. The regulator noted that the sector has grown significantly in recent years, playing a critical role in supporting credit access, particularly for Micro, Small, and Medium Enterprises (MSMEs).
Under the new framework, all entities providing credit guarantee services will be required to either register or obtain a license from CBK. Registered providers will need to meet minimum operational standards, while licensed institutions will be subjected to stricter requirements, similar to commercial banks and other regulated financial institutions.
The regulations further outline obligations regarding governance structures, risk management systems, licensing, and periodic reporting. Entities already in the business have been granted a five-year transition period to comply. Once this period lapses, unregistered or unlicensed operators will be deemed non-compliant and could face regulatory penalties.
CBK has made the draft regulations available on its website and provided an online platform where members of the public can submit feedback. The deadline for submissions is Wednesday, October 15, 2025.
“Entities providing credit guarantee business play a pivotal role in ensuring that critical economic sectors such as MSMEs continue to access affordable credit sustainably,” CBK noted in its statement.
Separately, CBK revealed it is working with stakeholders to develop the National Financial Inclusion Strategy (NFIS 2025–2028). The strategy seeks to consolidate policies and programs, address fragmentation in financial inclusion initiatives, and create synergies among stakeholders to advance Kenya’s inclusion agenda.
