Equity Bank has so far issued loans worth Sh57 billion through its platform Equitel launched in May 2014, highlighting Kenya’s growing uptake of mobile lending.
Kenya’s biggest bank by customer numbers said it processed a total of 7.5 million loan requests, with eight out of every 10 loan demands currently being processed and disbursed via Equitel.
The group’s chief executive James Mwangi said the ease of getting credit through mobile phones has seen Equitel average loan size more than double to Sh8,200 in the half-year to June 2017 compared to Sh3,900 in June 2015.
“Increased uptake is due to ease and convenience of access in addition to the quick decision making process. It is self-service,” Mr Mwangi said in an interview.
“The loan recipient doesn’t need security to be eligible for the loan, (and) the loan limits are based on your banking behaviour and credit history.”
Bank-backed lending apps such as M-Shwari, Equitel, M-Co-op Cash, and KCB M-Pesa have greatly transformed how Kenyans access loans, as consumers no longer need to fill lengthy paperwork, provide collateral or undergo vetting by credit officers.
There are also standalone mobile lending apps such as Branch, Tala, Saida and Mombo Mobile, which issue short-term loans via mobile money and charge a processing fee.Facebook-linked Branch mobile app said in July it had disbursed Sh3.6 billion ($35 million) since launching in Kenya in April 2015.