KCB Group has put into top gear, plans to pull the plug on its Mobiloan product, to be replaced by its freshly minted version dubbed Vooma loan, effective 23rd December, 2020.
It a text message to its customers the lender said, ” The loan will be for a period of one month at a cost of 5.91%. You will continue to access and pay for VOOMA loan on * 5223 or the KCB App,” said the text.
KCB has assured its that the decision has been made to ensure a fast, flexible and reliable borrowing experience.
A move to pull down the KCB Mobiloan product after the lender put in KSh 30 Billion in March this year, into the platform, to support individuals and businesses survive the pandemic.
KCB extended borrowing limits and repayment periods on the mobile loan product, it has been forced to pull it down and replace with a one month loan, while charging a much higher rate to borrowers.
The KCB Mobiloan had borrowing limits from KSh 50 to Sh1 million, spread into one month, three months and six months loans with rates of between 2% to 6%.
KCB has more than 22 million KCP M-Pesa customers who borrowed Sh212 billion in 2019.
According to the Q3, 2020 financials, KCB reported KSh 10.9 Billion in Net Earnings. This is 43% lower than the KShs.19.2 Billion in Q3, 2019.
While releasing the Q3, 2020 results KCB Group CEO&MD described the quarter as challenging for the business, staff, customers as well as the economy.
In the nine months of 2020, KCB restructured customer loans to the tune of KSh 105 Billion.
Non-funded income was slightly up from KSh 21.0 billion to KSh21.3 billion, in what the lender attributes to the reduction in loan disbursements to mobile customers during the period.
The non-performing loans (NPLs) book rose to KSh.97.0 billion up from KSh42.6 billion in Q3 of last year.
Oigara expressed optimism that while the pandemic will hurt the business well into 2021, the lender was projecting some recovery as East Africa grapples with the virus.
He said KCB will continue to support its customers through the crisis and enhance initiatives geared towards ringfencing the business. The approach is twinned-conserving cash and managing cost.
The new Vooma loan app will enable easy and secure digital and wallet payments via mobile phone.
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