Kenya Commercial Bank has said that lending services on its popular KCB Mpesa platform have been restored after a one week of unavailability due to a “technical hitch caused by a sudden increase in loan requests following the decrease in interest rates.”
The Nairobi Securities Exchange listed lender also noted that it had revised interest rates for all unsecured loans to 14% per annum to reflect the new CBR but also said it will include an extra charge dubbed “one time negotiation fee of 2.5%” bringing the total charges to 16.5%. Interest rates borrowed through the KCB-Mpesa platform will now be charged at 3.6% per month up from 1.4% which the bank had declared 13 days ago. (3.6% = 2.5% negotiation fee and 1.16% interest per month).
KCB M-PESA account is a virtual mobile based bank account which was launched in March 2015 and is offered exclusively to M-Pesa registered customers, enabling the users to borrow micro loans between Sh50 and Sh1 million and save on their mobile phones. The platform offers deposit and withdrawal services via the M-Pesa system.
According to the CEO Mr Joshua Oigara, the platform currently has nearly seven million customers and has given out about Sh12 billion in micro loans since it was launched with the average value of loans per customer averaging Sh1800 and 57% of the loans falling below Sh1000.
