Mobile loan apps are still in “in thing” in Kenya with millions of Kenyans now depending on them for Instant cash that requires no paperwork.
Kenya has about 500 mobile lenders and more than 60 known online apps that issue out micro loans to Kenyans from all walks of life.
At the end of 2019, of the more than 2.7 million Kenyans who had been blacklisted at the CRB, 500,000 of them had loans below 200 shillings. 100 percent of those with loans below 200 shillings had acquired them through mobile loans.
The majority of mobile loan apps in Kenya issue a minimum amount of 500 shillings with the maximum standing at 70,000 shillings for some tens of them.
Talking about mobile loan apps in 2019, the Governor of the Central Bank of Kenya (CBK) Dr. Patrick Njoroge described them as cruel shylocks who had advanced to using mobile platforms to exploit desperate Kenyans.
Kenyans love mobile loan apps because all of them do not ask for security. In all of them, also, there is no paperwork. All the borrower needs is a mobile phone and a satisfying credit rate.
The rate at which Kenyans are getting blacklisted by mobile lenders for either delaying or failing to repay their loans is alarming and something needs to be done.
Given that the mobile loan apps are not regulated, the safety of the data that these mobile loan apps collect from their customers is not guaranteed.
All mobile loan apps ask permission from their customers to access their phones in terms of making calls, sending and reading messages. Some are now asking permission to access phone cameras.
As a way of “security” for their loans, some apps are asking their customers to provide contact details of at least two “emergency contacts” with some of the options being “spouse, friend, mother, father, brother, friend, or colleague.”
Out of desperation to get cash, Kenyans are giving out all the information about them to “total strangers.”