At least 19 million Kenyans are listed on Credit Reference Bureaus (CRB), out of which 17 million are eligible borrowers but over 2 million of them are defaulters and therefore cannot access loans from any financial institution.
This was revealed by Metropol Corporation Managing Director Sammy Omukoko, who said that most of them are young borrowers who do not have a concrete source of income.
According to Mr Omukoko, most of the borrowers borrow money from digital lenders and later throw away the SIM cards used to borrow the money.
“They take money and throw away their sim cards, get another one, borrow and again destroy the sim cards. Some take the loans but they have no money to repay the loan while others take the loan but before repaying, they lose their jobs,” said Mr Omukoko.
Read: No Extending Deadline: CBK To Digital Lenders On Registration
He says that a lot of borrowing happens between 2am and 5am mostly in Nairobi among the slum dwellers and small-scale businessmen and women.
“There is a lot of online borrowing between 2am and 5am with a majority being Nairobi residents. Upon investigations, we realised that they were small-scale traders at Gikomba market and slum dwellers,” said Omukoko.
One of the most popular platforms is Safaricom’s overdraft facility dubbed Fuliza. The value of disbursements on Fuliza increased from Ksh246.6 billion in 2020 to Ksh351.2 billion in 2021. This means that on average, Ksh962.2 million was disbursed every day via Fuliza.
Ksh94.5 billion was disbursed on M-Shwari in 2021 and Ksh51.1 billion on KCB M-Pesa. It means between Fuliza, M-Shwari and KCB M-Pesa a total of Ksh496 billion was disbursed in 2021.
At least 5.9 million used Fuliza in 2021, to cover various expenses.
Read: NCBA Reaps Billions From Fuliza, M-Shwari
