Kenyan Buy Now, Pay Later firm Wabeh has reduced its vendor activity across parts of its network, citing a strategic shift toward refining its credit underwriting models.
The company confirmed that the move affects only a portion of its merchant base and is not a full pause in operations. According to Wabeh officials, all vendors impacted by the decision, whether active or paused, have been settled financially. The company expects to resume its expansion by the fourth quarter of 2025, contingent on the deployment of its updated infrastructure and credit assessment tools.
The firm’s model allows customers to acquire smartphones by paying an upfront deposit, usually 30%, and repaying the remainder in instalments on a weekly, bi-weekly, or monthly basis. To mitigate risk, devices are installed with remote lock software that disables the phone in case of missed payments. In practice, however, some customers have defaulted after damaging the devices or misjudging the affordability of the instalment schedule, according to Techcabal.
Credit risk exposure and underperformance
Wabeh operates a B2B2C model in which retailers stock smartphones and Wabeh provides the credit layer. When a customer is looking to finance a device, Wabeh pays the retailer and later collects repayments from the customer. The firm also maintains commercial agreements with device manufacturers such as Transsion Holdings, which produces Infinix, TECNO, and iTel phones. For every phone sold on credit, Wabeh sends a small fee to the manufacturer, particularly when a remote lock is used to secure the transaction.
A representative from Wabeh said the decision to reduce exposure to low-volume merchants was intended to avoid stretching operational resources across marginally profitable outlets. The focus now, the company added, is on strengthening its data-backed underwriting capabilities to better manage credit risk.
Regulatory oversight on the horizon
The company is currently operating under provisional arrangements while it awaits a decision on its pending Digital Credit Provider Licence application, submitted to the Central Bank of Kenya (CBK) in 2023. Though CBK now oversees most digital lenders, BNPL providers remain outside formal regulatory boundaries.
The Business Laws (Amendment) Bill, 2024, currently under review in Parliament, aims to include BNPL platforms within CBK’s regulatory scope. The Bill proposes replacing the term ‘digital credit’ with more inclusive language that encompasses asset finance and instalment-based models.
