A Kenyan court has dealt a blow to unlicensed digital lenders, ruling that firms operating without a Central Bank of Kenya (CBK) licence cannot use the courts to recover debts from borrowers. The loan was secured by a motor vehicle, but the lender told the court that the borrower defaulted, leaving an outstanding balance of Ksh85,000, which had subsequently increased to Ksh500,000. However, before considering whether the borrower owed the amount claimed, the court examined the lender's legal capacity to bring the case. In its finding, the court found that the claimant was not licensed by CBK, meaning it was operating and giving loans without approval. However, for lenders, particularly digital lenders, the ruling emphasises the importance of obtaining a license from the regulator before beginning to operate.