This archive report was first published on 26 August 2019.
Published on August 26, 2019, a report by Standard Investment Bank (SIB) has shed light on the growing trend of borrowing among Kenyans, particularly through Safaricom's Fuliza facility.
Launched in November 2018, Fuliza allows Safaricom's M-Pesa customers to access a top-up loan when they run out of cash during a transaction. The facility has been a game-changer for many, with over 20 million M-Pesa customers utilizing it.
According to the SIB report, Safaricom and its business partners, Commercial Bank of Africa (CBA) and Kenya Commercial Bank (KCB) Group, have disbursed an estimated total of 81 billion Kenyan shillings in the past six months. This staggering figure is a testament to the growing demand for credit among Kenyans.
Breaking down the figures, Commercial Bank of Africa contributed approximately 54 billion Kenyan shillings to the facility, while KCB Group extended 27 billion Kenyan shillings. The current revenue-sharing formula among the three partners stands at 40:40:20 for Safaricom, CBA, and KCB Group, respectively.
As the demand for credit continues to rise, it is essential for financial institutions to ensure that their lending practices are responsible and sustainable. The Fuliza facility has been a success story, but it also raises concerns about the potential risks associated with over-borrowing.
