Banking & Finance

Acting for Kenyan commercial banks, microfinance banks, DFIs, fintechs and corporate borrowers on bilateral and syndicated lending, project finance, asset finance, trade finance and security creation and enforcement. Regulatory advice spans Banking Act licensing, CBK prudential guidelines, the Microfinance Act, the National Payment System Act and the Digital Credit Providers Regulations.

OLM Law Advocates LLP is a leading banking and finance law firm in Kenya, recognised in the Legal 500 for our work on complex financing transactions. We act for international and domestic banks, development finance institutions, private equity funds, and corporate borrowers on the full spectrum of banking and finance matters.

Our banking practice spans syndicated and bilateral lending, project finance, asset-based finance, debt restructuring, and regulatory compliance with the Central Bank of Kenya (CBK). We have particular expertise in structuring and perfecting security under the Movable Property Security Rights Act, 2017 (No. 13 of 2017), which has significantly reformed secured lending in Kenya.

We advise on all aspects of security documentation, including charges over real property, debentures, guarantees, and the registration of security interests with the Collateral Registry. Our team ensures that all financing structures are compliant with Kenyan banking regulations and enforceable in the event of default.

Banking & Finance

Full-service banking and finance legal support for lenders, borrowers and financial institutions.

Acting for Kenyan commercial banks, microfinance banks, DFIs, fintechs and corporate borrowers on bilateral and syndicated lending, project finance, asset finance, trade finance and security creation and enforcement. Regulatory advice spans Banking Act licensing, CBK prudential guidelines, the Microfinance Act, the National Payment System Act and the Digital Credit Providers Regulations.

What we advise on

We act on bilateral and syndicated lending, project and infrastructure finance, asset and equipment finance, trade and supply-chain finance, acquisition finance, and the creation, perfection and enforcement of security — debentures, charges over land, share charges, chattels mortgages and guarantees. On the regulatory side we advise banks, microfinance banks, digital lenders and payment providers on licensing, prudential compliance and product structuring.

Governing law and regulators

Our work spans the Banking Act, the Central Bank of Kenya Act and CBK prudential guidelines, the Microfinance Act, the National Payment System Act, the Movable Property Security Rights Act and the Digital Credit Providers Regulations 2022. We engage directly with the Central Bank of Kenya on licensing and approvals.

Key legislation:

• Banking Act (Cap 488) — Regulation of banking business and CBK prudential guidelines
• Movable Property Security Rights Act, 2017 — Creation, perfection, and enforcement of security over movable assets
• Central Bank of Kenya Act — CBK regulatory oversight and prudential requirements
• Insolvency Act, 2015 — Administration, liquidation, and restructuring of insolvent borrowers
• Proceeds of Crime and Anti-Money Laundering Act — AML compliance for financial institutions

Who we act for

We represent lenders and borrowers on both sides of the table — commercial banks, development finance institutions (DFIs), microfinance banks, fintechs and digital-credit providers, and the corporates and project companies that borrow from them. Acting regularly for both sides means we know where a deal will snag and how to structure around it.

Why OLM for banking and finance

We draft security that holds up under enforcement and documentation that survives scrutiny, and we are pragmatic about the commercial pressure of a financing timetable. For digital lenders, our combined banking and data-protection capability is a genuine advantage in a rapidly regulating market.

Clients choose OLM for:

• Recognised banking and finance expertise in Legal 500 EMEA
• Experience with all major Kenyan banks and international lenders
• Deep knowledge of the MPSR Act, 2017 and Collateral Registry processes
• Track record on landmark project finance and syndicated lending transactions

Our services

Syndicated & Bilateral Lending

Advisory on syndicated loan facilities, club deals, and bilateral lending for corporate acquisitions, project development, and working capital. We act for both lead arrangers and borrowers.

Security Structuring & Perfection

Structuring and perfecting security under the Movable Property Security Rights Act, 2017, including registration with the Collateral Registry, charges over land, debentures, and corporate guarantees.

Project Finance

Legal advisory on limited-recourse and non-recourse project financing for infrastructure, energy, and mining projects in Kenya, including lender security packages and inter-creditor arrangements.

Debt Restructuring & Workouts

Advisory on distressed debt situations, including standstill agreements, loan rescheduling, debt-for-equity swaps, and formal insolvency proceedings under the Insolvency Act, 2015.

Trade & Receivables Finance

Advisory on invoice discounting, factoring, supply chain finance, letters of credit, and bank guarantees under UCP 600 and Kenyan banking practice.

Regulatory Compliance

Advisory on Central Bank of Kenya prudential guidelines, anti-money laundering compliance under the Proceeds of Crime and Anti-Money Laundering Act, and banking licence applications.

Frequently asked questions

Do digital lenders need a licence in Kenya?

Yes. Since the Digital Credit Providers Regulations 2022, digital-credit providers must be licensed by the Central Bank of Kenya and comply with pricing-disclosure, debt-collection and data-protection requirements. We handle the licensing application end to end.

What security can a lender take over assets in Kenya?

Common security includes charges over land, debentures over company assets, share charges, chattels mortgages over movable property (now registered under the Movable Property Security Rights Act) and guarantees. The right package depends on the borrower’s asset base and the facility.

How are foreign-currency loans treated in Kenya?

Foreign-currency lending is permitted and common in project and trade finance, subject to CBK reporting and the borrower’s foreign-exchange exposure. We advise on withholding tax on interest and on currency-risk allocation in the documents.

What licences does a bank need to operate in Kenya?

Banks require licensing by the Central Bank of Kenya under the Banking Act and must meet capital, governance and prudential requirements. We advise on licensing applications and ongoing CBK compliance.

How are digital lenders regulated in Kenya?

Digital-credit providers must be licensed by the Central Bank of Kenya under the Digital Credit Providers Regulations 2022 and comply with pricing-disclosure, debt-collection and data-protection rules. We handle the licensing end to end.

What is the Movable Property Security Rights Act, 2017?

The MPSR Act, 2017 is a landmark piece of legislation that reformed secured lending in Kenya by establishing a unified Collateral Registry for security interests over movable property. It allows individuals and companies to use movable assets (vehicles, machinery, inventory, receivables, shares) as collateral for loans. The Act requires registration of security interests with the Collateral Registry for perfection. We advise lenders and borrowers on structuring security packages, registering charges, and enforcing security under the MPSR Act framework.

How do I perfect a security interest under the MPSR Act?

Perfection under the MPSR Act requires: (1) the security agreement must be in writing and signed by the grantor; (2) value must have been given; (3) the grantor must have rights in the collateral; and (4) the security interest must be registered with the Collateral Registry maintained by the BRS. Unperfected security interests may be void against a liquidator or a bona fide purchaser. We handle the entire perfection process including drafting security agreements and managing Collateral Registry filings.

What types of security can be created over land in Kenya?

Security over land in Kenya is typically created by way of a legal charge registered under the Land Registration Act, 2012. The charge must be registered with the relevant land registry to be enforceable. Additionally, a debenture may create a floating charge over all the assets of a company, including land. We advise on the most appropriate security structure, handle registration with the land registry, and ensure compliance with the Land Control Act (for agricultural land) and county government requirements.

What are the CBK prudential guidelines for banks?

The Central Bank of Kenya issues prudential guidelines that regulate capital adequacy, loan classification, provisioning, large exposures, and corporate governance for banks and mortgage finance companies. These guidelines affect lending terms, security requirements, and borrower eligibility. We advise both banks on compliance with CBK guidelines and borrowers on the implications of these regulations for their financing arrangements.

What happens if a borrower defaults on a loan in Kenya?

On default, a secured lender may enforce security through: (1) appointing a receiver or manager (under a debenture); (2) exercising a power of sale under a registered charge; (3) applying for a court order for foreclosure or sale; or (4) petitioning for the borrower’s administration or liquidation under the Insolvency Act, 2015. The enforcement process must comply with the MPSR Act (for movable assets) or the Land Registration Act (for land). We advise lenders on enforcement strategies and represent borrowers in defending enforcement actions.

Can a foreign bank lend to a Kenyan company?

Yes, foreign banks can lend to Kenyan companies, and this is common for large syndicated facilities. However, the loan agreement should be structured to address Kenyan choice of law and jurisdiction considerations, security perfection in Kenya, withholding tax on interest payments (typically 15% under the Income Tax Act unless reduced by a double tax treaty), and foreign exchange regulations. We advise on structuring cross-border loans to ensure enforceability and tax efficiency.

Explore Related Services

Industry sectors we advise in this area: Financial Services & Fintech · Real Estate & Construction

Related practice areas: Capital Markets · Corporate & Commercial · Projects & PPP

See also: Representative Matters · Our Lawyers · All Practice Areas

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Banking and Finance Law in Kenya · Fintech and Digital Lending Regulation in Kenya