M-Shwari and Fuliza have emerged as the biggest lenders to Kenyan SMEs. This is according to a recent report by research firm, Viffaconsult, the aforementioned lending platforms emerged as sources for readily available credit for small enterprises ahead of Tala and Branch.
The report dubbed Kenya SME Mobile Credit Finance 2020 highlighted Mshwari to be on the lead by 36% followed closely by Fuliza at 19%. KCB-M-PESA came in third with a staggering 16%. Other lending platforms used by enterprise owners were Tala, Branch, Okolea, Eazzy Banking and Timiza doting 12%, 6%, 5%, 4% and 2% respectfully.
Nevertheless, the report noted that financing for SMEs remains a major challenge despite impressive figures from digital lenders. “Access to finance remains the top challenge Kenyan SMEs face with the current financing mix including family and friends, chama, SACCO, savings, retained profit, Banks,” read a part of the report.
Scrutinising Kenyans’ borrowing habits, the report ascertained that 28% of Kenyans borrow between Ksh 5,000 to 10,000 while 17% borrow between Ksh 4,001 and 5,000.
The source reported that purchasing stock/inventory, settling utility bills, fulfilling customer orders, marketing activities, salaries and wages and purchasing assets emerged as the biggest reasons for borrowing.
Although a good number of Kenyans have banked the idea of borrowing from digital lenders, a sizeable chunk of Kenyans harbour reservations over a throng of factors. Among the worrisome reasons cited are; being listed with Credit Reference Bureaus (CRBs), short tenors, insufficient credit limit, high interest rates, data privacy and customer protection.
