Kenya’s fastest-growing microlender Mwananchi Credit has said it will bolster its liquidity relief support for business impacted by COVID-19.
As most credit companies, both digital and conventional microcredit providers shy away from issuing loans due to high-risk environment under the Coronavirus pandemic, Mwananchi Credit has instead increased its loans portfolio.
A week ago, it added a new trade-in car loan facility to its asset-financing loans and introduced interest-free loans to existing customers to cushion them from financial hardships during the Covid-19 pandemic.
Many employees have already lost their jobs while a good number of employers have reduced salaries for their staff, thus squeezing individual incomes.
Consequently, lenders have tightened lending terms and conditions to lock out borrowers perceived to be high-risk, while others have suspended lending altogether.
Mwananchi Credit says it has maintained its normal terms and, in fact, sweetened the deal to stand with Kenyans during these difficult moments in line with President Uhuru Kenyatta’s appeal to lenders to ease conditions for borrowers.
“We understand the situation Kenyans are facing and so we haven’t changed our terms as an indication that we are in this together,” says Dennis Mombo, Mwananchi Credit chief executive “If we have to adjust our terms it has to be easing the burden, not making it worse.”
Mombo said all its range of credit facilities are still active, which include logbook loans, asset financing, weekend loans, check discounting, LPO financing as well as salary advances, import financing, and secured loans.
Mombo said Mwananchi has adjusted its operations to comply with the Ministry of Health guidelines on social distancing to reduce the possibility of infections among staff and customers. This will enable it to serve its client during the partial lockdown in some towns occasioned by the Coronavirus crisis.
“We not laying off employees nor reducing salaries like it is happening across the economy,” Mombo says. “As a company, we are absorbing the extra cost of keeping them without changing their terms.”
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