Equity Bank spiced up its mobile phone microloans product Friday as it said its customers will now access higher credit amounts that are payable over a longer period through the Equitel platform.
The tier I lender said its new “Eazzy Plus Loan” product will enable customers to borrow up to Sh3 million payable within 12 months, up from a minimum of Sh100 to Sh200,000 which was payable within a 30 day period.
“We believe that in the next few years Equitel will do five more times the number of transactions than all other channels put together,” said Equity Group’s chief executive James Mwangi.
The move follows the NSE-listed bank’s announcement in March that Equitel’s 1.7 million customers had transacted over Sh115 billion last year compared to Sh4.7 billion in 2014.
The value of Equitel loans stood at Sh8.5 billion in 2015 while 78 per cent of all loans the bank disburses are now accessed through the mobile platform, the lender also said.
Equitel combines both banking and telecom services including voice, data and SMS services on a single SIM card.
Mr Mwangi said the move is a response to the growing use of Equitel for accessing loans by the bank’s customers.
The chief executive said that the increased use of Equitel to access credit “will benefit users since the loan repayment rate through the mobile platform is better than other channels.”
“We can significantly reduce the cost of borrowing for our customers,” he added.
KCB Group runs a similar mobile credit facility whose loans range from Sh50 to Sh1 million while Co-operative Bank’s M-Co-op Cash also offers secured personal loans of between Sh100 and Sh200,000 repayable within 30 days.
Commercial Bank of Africa’s (CBA) joint mobile banking product with Safaricom, M-Shwari, allows subscribers to save between Sh1 and Sh100,000 and qualify for loans ranging between Sh100 and Sh20,000 depending on one’s savings.
Source: Business Daily