Safaricom has today made a few adjustments to their overdraft facility Fuliza. The telco has now reduced daily charges for loans below Sh1000 by 40pc and introduced a three-day grace period.
Safaricom which is Kenya’s largest most profitable and largest telco will now charge Sh6 daily on loans of up to Sh1000, down from Sh10, however, the company has retained the 1 percent access fee on all borrowings.
Together with its partner banks KCB and NCBA, Safaricom will charge sh3 on loans below Sh500, down from Sh5.
More expensive loans of between Sh2500 to Sh70,000 will attract a 16.7 percent price cut taking it from Sh30 daily to Sh25.
Here are the new Reduced Fuliza Rates
“We are taking additional deliberate steps to provide affordable credit to Kenyans in our contribution to drive up economic activity and recovery. We will anchor this on strong partnerships with various stakeholders while deploying innovative digital capabilities to enhance financial access and inclusion,” said Paul Russo, CEO of KCB Group while speaking on the new rates.
“This restructure aims to reinforce the original purpose of Fuliza – a short-term overdraft facility for 4 to 7 days. From the data that we have, it is clear that the original intent for Fuliza to be a short-term credit facility has evolved. Since the COVID-19 pandemic, many customer M-Pesa wallets are now remaining overdrawn for 14-19 days. This is what we intend to address with this announcement. Additionally, we wish to express our intention to work with our partners and other industry stakeholders to rethink the credit information-sharing framework that underpins CRB to better enable Kenyans, especially Kenyan entrepreneurs to access credit more seamlessly. The specific mechanisms for this for M-Shwari and Fuliza customers shall be announced by 1st November 2022.” said John Gachora, Group Managing Director, NCBA
The expensive Fuliza overdraft facility was launched back in 2019, in partnership with Commercial Bank of Africa (now merged into NCBA) and KCB Group, and has since become one of the leading mobile loans, disbursing Sh1.5 billion daily.
The product may however be facing potential competition from a new zero-interest credit service dubbed Faraja.