Home Business Safaricom raises minimum amount you can borrow from M-Shwari...

Safaricom raises minimum amount you can borrow from M-Shwari to Ksh. 2000

M-Shwari – a mobile lending service from NCBA that’s available on Safaricom’s MPESA service will now require customers to borrow a minimum of Ksh. 2000, otherwise your loan request will be completed as an overdraft through Fuliza service. This is an effective increase of four times from the previous minimum. It’s also seen as a technical move from defaults below the amount which according to CBK’s regulations, will not be forwarded to credit reference bureaus.

Up until now, borrowers were able to access loans from Ksh. 500 via M-Shwari. Due to tough economic times which have forced many Kenyans to default their loans, CBK issued new directives exempting anyone defaulting loans from April this year to be listed with credit reference bureaus.

In addition, borrowers who default on loans less than Ksh. 1000 will no longer be listed with credit bureaus, and those who had been listed are to be expunged from their records. Consequently, M-shwari somehow is looking to only offer loans which can be forwarded bureaus in case of defaulters.

Customers who require lesser amounts will now be forced to take Fuliza overdraft which is way more expensive than M-Shwari at a 1.083 percent or 395.2 percent annually. In real life comparison, if you borrowed Ksh. 1000 via M-Shwari, you’d have only paid Ksh. 56.25 while on Fuliza is Ksh. 243.68.

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