Digital technology experts are now accusing the Central Bank of Kenya of choking the innovation pipeline through overregulation.
Players say the move is locking out many investors and persons willing to do business within the country.
Speaking in Diani, Mombasa during an Information Systems Audit and Control (ISACA) Kenya Chapter annual conference, Strathmore University Academic and Research Director, Dr Jim Mcfie, said over-regulation will kill the industry that is operating at this critical time where there is full transformation to technology.
“You should not just keep people out because of anti-money laundering and not financing crime. This can happen very few times in our history in Kenya. All the legislation is there, so let us be open to innovation,” he said.
To deal with the threat that is facing the financial industry, the CBK has in the recent past increased its surveillance on financial sector. Digital lenders are the latest to come under the regulatory microscope of the CBK.
Dr Mcfie who was the chief guest at the event said previous studies have shown that there is overregulation in Kenya, and this slows down the growth of the digital industry in the country.
He said instead of the many bottlenecks and laws that do not solve most challenges, Kenya should in its their place develop honesty that will lead to further growth of sectors such as digital banking and lending that will in turn birth a vibrant economy in the digital age.
“You do not solve problems by passing laws and increasing legislation. Development can only take place if we work in an environment where honesty starts from top officials,” he explained.
ISACA Kenya’s vice-president, Mercy Omollo, said Kenya is setting up many regulations for digital businesses and operations had both its positives and negatives.
“We understand that there are so many risks involved such as predatory digital lending apps and incidents of hacking. But as information technology professionals, we want to discuss how we can best leverage organizations to enable them to build digital trust,” she said.
She said there were so many policies that have been put in place in the country but the challenge is at the implementation stage where the government and some individual organisations are failing, hence creating risks in cybersecurity and safety.
