Feature: Let’s Not Throw Out the Baby with the Bathwater: Why Responsible Digital Lending Still Matters

Few developments in financial services have generated as much public debate in recent years as digital lending. For some Ugandans, mobile loan applications have provided a convenient source of emergency funds, working capital and financial support when traditional financing was out of reach. For others, the experience has been marked by excessive charges, aggressive debt collection, threats and concerns over the misuse of personal information.

These contrasting experiences have shaped public perceptions of an industry that continues to play an increasingly important role in the country's financial ecosystem.

For a small business owner who needs to restock a shop before the next trading day, a farmer preparing for a planting season or a trader facing an unexpected expense, access to timely credit can make a meaningful difference. Yet obtaining a loan from a traditional financial institution is not always straightforward. Borrowers may need formal financial records, conventional collateral or proof of stable income that many informal businesses and low-income earners cannot readily provide.

While the concerns surrounding digital lending must be addressed, they should not overshadow the role that responsible providers can play in expanding access to finance. The answer to misconduct should not be to dismiss an entire industry, but to hold offenders accountable while creating an environment in which responsible lenders can continue serving the people and businesses that need them.

Read more at: https://mountkenyatimes.co.ke/lets-not-throw-out-the-baby-with-the-bathwater-why-responsible-digital-lending-still-matters/