In today’s digital age, financial solutions are just a few taps away. Loan apps in Kenya have revolutionized the way people access credit, making it more convenient and accessible than ever before. Whether you’re facing a financial emergency or looking for a quick boost to your business, loan apps in Kenya can be your saving grace. In this comprehensive guide, we’ll explore everything you need to know about these apps and how they can benefit you.
Understanding Loan Apps in Kenya
Loan apps in Kenya are smartphone applications that allow individuals to borrow money instantly, without the need for extensive paperwork or long approval processes. These apps have gained immense popularity due to their simplicity and speed. With just a few clicks, you can secure a loan to meet your financial needs.
Key Features of Loan Apps in Kenya
- Quick Approvals: One of the most significant advantages of loan apps in Kenya is their lightning-fast approval process. You can receive approval within minutes, and the money is often disbursed to your mobile wallet or bank account almost instantly.
- Flexible Loan Amounts: These apps offer a wide range of loan amounts to suit various needs. Whether you need a small loan for personal expenses or a larger amount for your business, you can find a loan app in Kenya that caters to your requirements.
- Convenient Repayment Options: Loan apps in Kenya typically offer flexible repayment options, including weekly, bi-weekly, or monthly installments. This allows borrowers to choose a plan that aligns with their income and financial capabilities.
- No Collateral Required: Unlike traditional banks, most loan apps in Kenya do not require collateral for loan approval. This makes them accessible to a broader range of individuals, including those without valuable assets.
How to Apply for a Loan Using Loan Apps in Kenya
Getting a loan through these apps is a straightforward process:
- Download the App: Start by downloading the loan app of your choice from the Google Play Store or Apple App Store.
- Register: Create an account by providing your personal information and verifying your identity.
- Loan Application: Fill out the loan application form, specifying the loan amount and repayment period.
- Approval: The app’s algorithm will assess your application and provide an instant decision.
- Disbursement: If approved, the loan amount will be transferred directly to your mobile wallet or bank account.
Safety and Security Concerns
While loan apps in Kenya offer convenience, it’s crucial to prioritize safety and security:
- Research: Before using any loan app, research its reputation and reviews to ensure it’s a legitimate and trustworthy service.
- Permissions: Be cautious about the permissions the app requests. Only grant access to necessary information.
- Interest Rates: Understand the interest rates and fees associated with the loan, as these can vary from one app to another.
- Repayment Discipline: Always repay your loans on time to avoid penalties and maintain a good credit score.
Features of the best mobile loan apps
Each app’s interest rates, repayment alternatives, and eligibility criteria differ differently, but here are key aspects to consider when selecting an app:
Interest Rates: The majority of applications provide competitive interest rates ranging from 1-1.5% each month.
Repayment Terms: Most applications include flexible repayment options ranging from short to lengthy terms, allowing you to pay back at your own speed.
Eligibility Criteria: Each app has its own set of requirements, the most frequent of which include a strong credit score rating (CRB), a mobile number, a National ID, and an M-PESA account, among others.
Categories of mobile loan apps in Kenya
There are four main categories of mobile loans in Kenya
- Mobile loans offered by Safaricom eg Mshwari and Fuliza
- Mobile loans offered by banks and saccos eg Timiza, NCBA Loop
- Mobile loans offered by downloadable apps from the internet eg Tala, branch
- Hustlers Fund which is offered by the government
Best mobile loan apps in Kenya
Branch
Branch International first offered it to Kenyans in 2015. The branch loan app is Kenya’s second oldest online mobile lending platform after Tala. The Branch loan app is available in Kenya, as well as Tanzania and Nigeria. The mobile lending app offers loans of up to KES 70,000 to its subscribers.
To begin using the Branch App, download it from Google Play, sign up with Facebook, log in, and you will automatically know if you qualify for a loan. If you are approved for a loan, you will receive it via M-Pesa.
Tala
Tala Loan App is one of Kenya’s best and most established mobile loan applications. Tala has become Kenya’s most trusted mobile loan provider and one of the top rapid lending apps in the years it has been in operation.
They provide loans of up to 30,000 and disburse them through M-Pesa. They take pleasure in providing loans in less than 5 minutes, and by repaying your loans on time, you will grow your credit up to the maximum amount.
Tala features a variable payment time ranging from 21 to 61 days. Tala interest rates range from 7% to 19% for 30-day loans and from 5% to 14% for 21-day loans. By answering basic questions about your financial situation, you can quickly qualify for an instant loan. If authorized, the loan is transferred directly to your MPesa account.
Mcoop cash
Customers of the Cooperative Bank of Kenya can use this loan app to get bank services such as emergency loans. It displays account balances and transfers funds from MCo-op Cash to Mpesa and Airtel.
It also enables bank users to buy airtime using their MCo-op cash account, among other things. You can apply for up to 200,000 shillings, or 1.5 times your net wage, via the MCOOP Cash App.
Hustler’s Fund
This government-led project provides citizens with personal finance loans starting at Ksh 500 with a yearly interest rate of 8%. Individual borrowers can borrow up to Ksh 50,000.
Borrowers have 14 days to repay the loan and acquire another, but if they don’t, the interest rate jumps to 9.5% and they have until the 30th day to settle it.
Zenka
Zenka is one of the country’s mobile loan apps in Kenya. The app has been functioning for several years, and they are constantly revising their conditions.
Zenka guarantees a loan limit of Ksh 500 – Ksh 50,000 based on your credit score, with an interest rate of 9 – 30%.
Most Zenka loans have a 61-day term, but the app says nothing about late fees, even though they exist.
KCB Mpesa
You can use KCB M-Pesa if you are a registered M-Pesa user. You don’t have to go through the hassle of downloading and installing the program because it’s already on your phone.
Simply go on the KCB Mpesa button under loans and savings and choose a loan. That’s all. They do not require any registration or further information from you.
They will send the loan amount to your Mpesa account once the amount you requested is within your loan limit. As a result, KCB M-Pesa is among the top online M-Pesa loans in Kenya today.
Timiza
Timiza is an online mobile money app developed by Absa Group, formerly known as Barclays Bank Kenya, one of Kenya’s local banks. The nicest part about Timiza is that, unlike other bank apps, it is available to all Kenyans rather than just bank customers.
Apart from loans, the Timiza app also functions as a bank account for users to manage their accounts. Timiza loans have a 30-day repayment period and a maximum borrowing amount of KES 150,000.
Mshwari
All of the other apps perform best when combined with M-Pesa. Therefore, like KCB, M-Pesa Safaricom, in collaboration with NCBA Bank, provides a mobile lending option called Mshwari.
Mshwari is one of the oldest and best Mobile loan apps in Kenya. It works on the idea of saving in order to obtain a loan. They may boost your limit according on how well you stay on Mshwari and repay your previous loans.
Fuliza
Safaricom and NCBA Bank collaborated on the Fuliza overdraft facility. If you have insufficient cash in your M-PESA account, it allows you to acquire loans above your loan limit.
For example, if you send money and your balance is insufficient, they provide an overdraft facility. Just accept, and the remaining sum will be transferred to your M-Pesa account.
Eazzy Loan
Applying for an Eazzy loan is as simple as opening an equity bank account, downloading the app, and filling out the online application form.
The loan is disbursed to your bank account in minutes after approval. To help you remain on top of your expenses, the app also includes budgeting tools and repayment reminders.