Technology: Revolutionizing the Lending Sector the UbaPesa Way

Kenyans are always looking for an easier way to access loans. In simple terms, Kenyans are ever ‘borrowing’, not from charity organizations but from institutions where they will have to pay back.

Initially, Kenyans used to borrow money from commercial banks. Things have since changed. Very few Kenyans will approach a bank for a loan unless they have security or a big project that needs a lot of money.

Technology has completely revolutionized the lending sector in Kenya. The coming of mobile loan apps has really shifted the borrowing habits of people with many people keeping off traditional form of borrowing from banks.

Among the many mobile loan apps that exist, one UbaPesa stands out of the rest as a convenient app that can help Kenyans improve their lives through access to affordable loans.

Before I go deep into the loans, which most people love, allow me to first take you through the UbaPesa journey and how it works.

Different from other apps whereupon downloading you will log in and start processing for a loan, which, by the way, you may or may not get, UbaPesa gives you a wide range of choices of where and from who you should take your loan from.

In traditional banking, people walk into the bank and ‘store’ their money with the bank. The bank doesn’t sit with the money. It takes the same money and gives it to other people as loans. The money is thus always in circulation. The bank is just a channel that has enabled people to give and take money.

UbaPesa app, on the other hand, brings together lenders and borrowers under one platform. It is like a marketplace where people come to buy and sell money. When you come with your money to lend, you expect the person borrowing to give back plus the cost of money. It is a business, UbaPesa allows one to lend or borrow money for a period of either 10, 20 or 30 days with each period attracting a platform facilitation fee of 8%, 9%, and 10% respectively.

Upon downloading the app, one of the key features I noticed is that there is a category for lenders and borrowers. If you have come to lend money, you will go to the lenders’ side (which is on the left-hand side) and if you have come to borrow money, you will automatically go to the borrowers’ side (which is on the right-hand side.)

The app is that easy and very interactive to use. Think of it as an open-air market where traders come to interact with buyers. Here, lenders are those who have come to ‘sell their money’ and borrowers are basically the ‘buyers’ who have come to ‘buy’ money ‘without cash’ but pay later with a cost of money in terms of platform facilitation fee. The platform facilitation fee is shared between the lender of the money and UbaPesa who facilitated the lending and borrowing to happen.

Why should you choose UbaPesa over other apps? First is the opportunity to grow. With an initial loan limit of 500 shillings to 7,000 shillings, as a borrower, you will be able to borrow up to 70,000 shillings depending on your payment habit. The more you pay on time, the more you grow your loan limit.

Second is convenience. No one hates convenience. The app gives you an opportunity to get a loan from the comfort of your room or even office without security through your mobile phone. All you need to do is to download the app, fill in few details and you will in, walking through a wide range of services and products.

Features of the UbaPesa App

 The app has the following features:

• Money Market: this feature provides information on the available loans and lending requests.
• Lend or borrow money: feature to either place a lending or borrowing request. One can lend or borrow money for a period of either 10, 20 or 30 days.
• Credit score rating: this feature offers automatic credit scoring of each potential borrower or lender. This provides the creditworthiness and or risk of each member in the app. To put it another way, the CRB (Credit Reference Bureau) score tells a lender if a borrower can pay a loan or not and how much money they can be loaned.
• Automatic matching: This feature provides automatic matching of a lending and borrowing request provided the lender and borrower’s loan requirements meet in terms of credit score, amount and loan duration.
• Single and multiple lending: Means one can place a lending request to loan to either one borrower or do multiple lending where one lending request can be loaned to multiple borrowers.
• Real-time withdrawals: money is transferred to your M-Pesa account in real-time.

How does the app work? Watch out for steps on how the app works.