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M-PESA Improves Loan Lending to MSMEs with New Credit Products
Safaricom has made it easier for small businesses in Kenya to get loans through M-PESA. They have introduced new credit products that are designed to help micro, small, and medium-sized enterprises (MSMEs) grow by giving them easier access to money when they need it.
These new loans can be accessed using the M-PESA Business App or by dialing a simple code on your phone. The loans range from as little as about $7.74 (KES 1,000) up to $3,096 (KES 400,000), depending on how much a business qualifies for. This means small business owners can borrow money that fits their needs and pay it back easily. The repayment is automatic, taken from the money that comes into their business till, so they don’t have to worry about missing payments.
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Dr. Peter Ndegwa, the CEO of Safaricom, said that small businesses are very important to Kenya’s economy and communities. He explained that with these new credit products, called Taasi, businesses can get quick and convenient loans that help them focus on growing their work instead of worrying about money.
Esther Waititu, Safaricom’s chief financial services officer, also pointed out that MSMEs contribute a huge part of Kenya’s economy, about 40% of the country’s GDP and more than 83% of jobs. She said these new loans are specially made for around 700,000 Lipa na M-PESA merchants, making sure they get the support they need to succeed.
She added that this is just the beginning, and Safaricom plans to offer even more help to small businesses in the future. Also, she recognized the hard work of everyday entrepreneurs like market sellers, boda boda riders, and small shop owners, saying these new credit options are made for them and with their needs in mind.
To make this happen, Safaricom is working with big banks like KCB Bank, Sidian Bank, Diamond Trust Bank, and a digital lending platform called Pezesha. These partnerships help make loans easier to get and more fair, especially for people working in the informal sector who often find it hard to get credit.
The new credit products include Fuliza Biashara, which is an overdraft that lets merchants borrow money instantly from KES 1,000 up to KES 400,000. There’s also Taasi Till, a short-term loan ranging from KES 1,500 to KES 250,000. Both have flexible repayment times between 14 and 30 days, and the money goes straight into the user’s M-PESA wallet or till, ready to use immediately.
This new way of lending improves MSMEs by making it simple and quick for small businesses to get the money they need without complicated paperwork or needing to offer security. The loans are based on how much the business saves and spends, which helps prevent borrowing too much and getting into debt.
Every day, M-PESA lends out over $55 million with very few people missing payments, showing that this system works well and helps keep businesses strong.
M-PESA improves loan lending to MSMEs with new credit products that are easy to use and designed to help small businesses grow. This new support from Safaricom is a big boost for Kenya’s business community and will help many entrepreneurs succeed.
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