Kenyans Borrowing Mobile Loans Expected To Spike Over Festive Season

Mobile money lenders are looking to take advantage of Kenyans taking out short-term loans for the festive season, the digital lenders expect a spike in the coming weeks up to early 2020.

The need for quick loans to pay for holidays ahead of Christmas and New Year festivities and school fee is expected to fuel demand.

Nearly 17 million digital loans have already been disbursed as Kenyans increasing turn to their mobile phone to access credit.

“Across Kenya, 16.4 million loans have been disbursed digitally since the launch of the first digital credit offering seven years ago. In the past two years alone, the number of digital loans issued has approximately doubled,” a survey conducted last month shows.

Mobile lenders have however been asked to perform thorough background checks before giving out loans in order to cushion themselves from those already saddled with unpaid loans.

Requests by banks for loan repayment reports from credit reference bureaus (CRBs) jumped nearly three-fold to 12.40 million. Central Bank of Kenya (CBK) data shows that requests for loan reports from the CRBs rose by 181.1 percent last year.