My father once told me that there are two kinds of people: those who do the work, and those who take the credit. He told me to try to be in the first group; there was much less competition there. He also did caution me on the aspect of integrity and being genuine in what I opt to do for a living. Off course he didn’t offer any advice on how to get the needed money to help me set up my business back then and I made a lot of mistakes, killed a lot of friendships and learned so much.
Access to credit has always been a big challenge to anyone getting into the business. Our banks are very brick and mortar when it comes to this and back then things were tough. Loans and overdraft facilities were things only the rich and the well-connected knew about and were able to access.
An overdraft is an extension of credit from a lending institution when an account reaches zero. An overdraft allows the individual to continue withdrawing money even if the account has no funds in it or not enough to cover the withdrawal. Basically, overdraft means that the bank allows customers to borrow a set amount of money to be paid back the moment any money hits the account automatically.
Overdraft is a credit facility whereas a bank loan is a facility for borrowing a certain fixed amount of money. Interest on an overdraft facility is charged only on the amount drawn by the user. However, interest on a bank loan is charged on the amount sanctioned by the bank.
In a blink of an eye, access to credit has become as easy as saying ABC and it’s a great relief for entrepreneurs because now we can have some liquidity to run around as we struggle to nurture our businesses. Liquidity is the fuel that encourages the SME owner or entrepreneur to wake up tomorrow and hustle some more.
They say necessity is the mother of all innovations and indeed CBA Bank and Safaricom PLC through MPESA figured out that the best way to make more money and be able to support the entrepreneurship realm is to innovate on the need for credit access and voila, FULIZA MPESA was born.
This is a service that allows M-PESA customers to complete their M-PESA transactions when they have insufficient funds in their M-PESA account.
Basically, when you have a bad day, no one to borrow from, that client has delayed your payment yet again and you need to get the fare to see another client or you need to get diapers for your baby, then this is your saving grace without having to make a million calls to just get by. However, with such ease and convenience, comes at a cost.
This is a service that has shocked and wowed players in the financial world across the globe because within 7 days after its launch, customers had borrowed over 1 billion shillings and the client base was at 3M and growing without any media push or advertisement.
First, you need to be an M-PESA registered customer with an active Safaricom line. Dial *234# and select Fuliza M-PESA to opt in. You can also dial the same to opt out once you have paid the overdraft facility.
Every M-PESA registered line will be treated as a different account. Each mobile number will qualify for Fuliza M-PESA and will be awarded a limit. This limit will be reviewed every 3 months depending on your usage.
Dial *234# and Select Fuliza M-PESA to check your limit, balance, mini statement, and an opt-out option. Every time you transact using Fuliza, you will receive an SMS with the outstanding Fuliza amount.
The M-PESA transactions that can be completed using the Fuliza service are Lipa Na M-PESA: Buy goods and Pay bill as well as Send money.
You will be charged 1% access fee and a maintenance fee on the outstanding balance as per below table. Normal M-PESA transaction charges apply.
The service allows customers to complete their M-PESA transactions when they have insufficient funds in their M-PESA account.
Also, it’s important to note that, even if you haven’t paid for the facility and you desperately need some MPESA and you get some MPESA, the money you have received will go into paying off the overdraft facility and will still be available to you for use. As long as you don’t opt out and you keep getting any MPESA, that money will be available to you for use at a fee.
You will not have access to your Fuliza M-PESA limit if you have any unpaid balance after day 30. This will, however, be restored on full repayment of your Fuliza balance.