App dou­bles Bar­clays’ loan ap­pli­ca­tions to 10,000 per day

Business Daily (Kenya) - - CORPORATE NEWS - Pa­trick Alushula [email protected]­tion­

Bar­clays Bank of Kenya’s mo­bile loan ser­vice, Timiza, has pushed up the lender’s loan ap­pli­ca­tions to 10,000 per day thanks to about three mil­lion bor­row­ers us­ing the plat­form.

The bank says this is a jump from 5,000 loan ap­pli­ca­tions per month that it was pro­cess­ing be­fore the app was launched in mid-march last year.

“Timiza has en­abled us to reach a unique tar­get mar­ket that is in need of fi­nanc­ing but is of­ten left out be­cause they don’t have the req­ui­site doc­u­men­ta­tion and want faster turn­around times,” said the bank.

Along with Timiza, the grow­ing space of bank-backed lend­ing app prod­ucts in­cludes Com­mer­cial Bank of Africa’s M-shwari, Equi­tel, M-co-op Cash, and KCB M-pesa.

The growth of prod­ucts also un­der­lines the grow­ing im­por- tance of dig­i­tal loans in the econ­omy as more lenders con­tinue to strengthen their of­fer­ing.

Banks have re­lied on such ap­pli­ca­tions to dis­burse high vol­umes of loans with low value, thereby mak­ing nor­mal in-branch loan ap­pli­ca­tions re­main on the lead in terms of value. For in­stance, Bar­clays’ app al­lows only up to Sh150,000.

Bar­clays tied the loan app with mo­bile in­sur­ance, which en­ables cus­tomers to ac­cess per­sonal ac­ci­dent and funeral ex­pense cover for as lit­tle as Sh42 per month. The lender says about 15,000 in­sur­ance poli­cies had been sub­scribed to, so far.

Dig­i­tal loan prod­ucts have been on a rise in the mar­ket de­spite con­cerns that they are be­com­ing a debt trap for cus­tomers.

Sec­tor reg­u­la­tors have also cau­tioned that the rapidly grow­ing dig­i­tal loans mar­ket has at­tracted a wide range of for­mal and un­reg­u­lated op­er­a­tors who pose se­ri­ous money laun­der­ing and ter­ror­ism fi­nanc­ing risks to the econ­omy. The Cen­tral Bank of Kenya said in the 2017 fi­nan­cial sec­tor sta­bil­ity re­port the ma­jor­ity of out­fits of­fer­ing dig­i­tal loans do so on re­laxed terms and know so lit­tle about their cus­tomers.

This is a jump from 5,000 loan ap­pli­ca­tions per month that the bank was pro­cess­ing be­fore the app


Bar­clays man­ag­ing di­rec­tor Jeremy Awori at Timiza launch last March.

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