Borrowings from Safaricom’s overdraft service rose to Sh1.2 billion daily in the six months to June this year, signalling the income shortfalls that have pushed many Kenyans to rely on short-term expensive debts.
The amount of cash disbursed on Fuliza hit Sh220.38 billion over the six months, marking a 25 percent jump from Sh176 billion in a similar period last year.
The jump in overdrafts translates to Sh1.2 billion daily borrowing between January and June this year, compared to Sh972.3million over a similar period of 2020.
The overdraft service introduced in 2019 and underwritten by NCBA Group and KCB Group allows customers to meet essential needs such as shopping, rent, sending money to friends and family or paying for goods and services on mobile money service, M-Pesa.
The surge in borrowing follows a period when the economy is slowly recovering from the loss of millions of jobs that has affected household incomes throughout the Covid-19 pandemic.
The impact of the pandemic has since reduced on easing of restrictions but the economy is yet to rebound to the pre-Covid period.
“Fuliza is still on a growth path that is why you see the most growth in digital loans this year is coming from Fuliza. We expect it to grow for quite some time and we still feel there is leeway for growth,” NCBA Group chief executive John Gachora said.