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| Tala mobile loan |
Digital lending platforms have now embarked on reducing defaulters rate after agreeing to lend only to employees and employers. They have also provided shocking measures to the youths. They said, under 25 years youth will not be allowed for any loans regardless of their status.
Mr Kevin Mutiso, the spokesperson of the Digital Lenders Association of Kenya (DLAK), says soon they will not lend to the young people and the unemployed to reduce the risk of defaulters.
“We have started working with bodies like Kenya Revenue Authority, National Registration Bureau and Credit Reference Bureau to get valuable information about our clients. This will help us stop lending to students and those who can’t repay,” he said.
Mr Mutiso gave the example of Shika App, a digital lender he runs that is no longer lending to people who are aged 25 and below, the majority of college students.
“Under this initiative, if a person has borrowed, say Sh20,000 from Tala he or she will be barred from taking another loan from any other digital lender before the previous loan is repaid in full,” said Mr Mutiso, adding that “we want to instil discipline among our customers.
“Kenyans today have more choices than ever before, but they also face more risks when it comes to managing their financial lives. Money March is a moment to bring providers and customers together to discuss how we can best leverage digital,” explained DLAK Chairman Robert Masinde.
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