By OUR CORRESPONDENT
The National Assembly Committee on Finance and National Planning has kicked off the process of freeing boda boda operators from the jaws of predatory digital lenders.
This is after three key Bills that are seeking to amend existing laws governing digital lending were subjected to public participation to incorporate views of stakeholders from across the country.
The proposals seeking to free the operators are contained in three crucial Bills; The Tax Laws (Amendment) Bill 2024, The Tax Procedures (Amendment) Bill 2024 and Business Laws (Amendment) Bill, 2024.
The Bills were arrived at after boda boda operators petitioned the National Assembly to institute regulations into the Buy-Now-Pay-Later (BNPL) credit sector.
The petition was committed to the Finance and National Planning Committee which commenced a probe into the allegations of exploitative lending tendencies.
The Business Laws (Amendment) Bill, 2024 will help reign in on unscrupulous lenders with a view to regulating the sector and protect operators who purchase their motorbikes through the BNPL arrangement.
The proposed law provides for consumer protection for borrowers from predatory lenders including setting conditions for micro-lending, financial costs associated with micro-loans as well as the rights and duties associated with micro-loans.
To prohibit illegal non-deposit-taking credit businesses that often expose consumers, the Bill proposes an amendment to the Central Bank Act to require licensing of the providers.
This means all non-deposit taking credit providers previously unregulated will be monitored by the Central Bank which will then enforce a code of conduct.
To enhance the spirit of transparency as required by the law, a non-deposit-taking Microfinance business shall furnish the consumer with accurate information on terms and conditions for lending, the financial costs to be met by the borrower and maintain confidentiality of information relating to borrowers.
In a bid to further bring sanity to the digital lending sector amid heightened efforts by the Office of the Data Commissioner and the Central Bank, the Business Laws (Amendment) Bill, 2024 proposes to make it stiffer for digital lenders to operate.
It says: “In the course of debt collection or loan recovery, a non-deposit-taking microfinance business shall not harass, abuse or oppress a borrower or guarantor, threaten or use violence or use obscene or profane language.”
If the Bill sails through, any lender who fails to heed to the provisions will face penalties.
