Secured loans provider Mwananchi Credit has waived penalties on loan defaults to reduce repayment burden for borrowers.
The company says the up to 100% default penalty fee waiver is aimed at cushioning customers from the adverse financial effects of the Covid-19 pandemic, which has pushed many households and businesses into the red.
Most Kenyans have either lost their jobs or are contending with reduced incomes due to the economic slowdown caused by the outbreak of Coronavirus in Kenya. Most companies have scaled down their operations, while others have temporarily closed and fired employees.
“With this in mind, Mwananchi Credit Limited would like to announce up to 100% penalty waiver for all its clients since the pandemic started in March this year,” Mwananchi Credit Director Dennis Mombo said in a statement.
Mr Mombo asked customers facing challenges in servicing their loans to come out and have their situations addressed by Mwananchi Credit officers.
“If you have experienced a drop in income or an outright job loss, the best thing to do is to reach out to us and let us know your circumstances,” he added. “Unlike other competitors, we don’t charge penalties on defaulted payments. We are flexible when a customer is more proactive.”
Mwananchi Credit Ltd offers an array of credit solutions including LPO financing, salary advance loans, cheque discounting, logbook loans, weekend loans and other loans secured by title deeds, among others.
Mr Mombo advised borrowers to share their financial situations instead of waiting for the company to intervene. Through the waiver, Mwananchi Credit Limited is offering temporary relief to consumers on loan repayments through various programs.
He said Mwananchi Credit understands that these are challenging and uncertain times and giving guidance to individual customers and small businesses experiencing cash flow problems.
“We are working directly with customers on a case-by-case basis to address their needs, and we are currently providing fee waivers and payment deferrals,” he said.
In March, soon after the pandemic was announced, Mwananchi Credit introduced interest-free loans for new customers and rebates for existing borrowers to ease the burdens of credit on Kenyans who are suffering the effects of a partial quarantine imposed by the government to reduce the spread of the highly infectious virus.