Kenyans ‘fuliza’ Sh1.2b a day, Mshwari shunned

The Fuliza overdraft service transacts more than Sh1.2 billion daily. [File, Standard]

Safaricom’s mobile overdraft service Fuliza now rakes in more revenue for the telco than its mobile lending service M-Shwari, less than three years after Fuliza’s launch.

Data from the company’s latest Sustainable Business Report indicates that Kenyans borrowed Sh351 billion from the firm’s mobile overdraft facility in the 2020/2021 financial year, a 43 per cent rise from Sh245 billion the previous year.

This pales the Sh94 billion that the telco lent out through M-Shwari over the same period, a 27 per cent drop from Sh129.6 billion the previous year.

The number of active users on M-Shwari also fell 15 per cent to 3.9 million during the period under review, down from 4.6 million users the previous year.

“Fuliza has remained our most popular loan product during the 2021 financial year with a 61.3 per cent year on year growth in revenue to Sh4.5 billion and more than 100 per cent growth in daily active Fuliza customers, now standing at 1.4 million,” said Safaricom in the report.

The Fuliza overdraft service now transacts more than Sh1.2 billion daily, going by numbers for the first half of this year, where the service moved Sh220.38 billion, a 25 per cent jump from Sh176 billion in a similar period last year.

Revenue from M-Shwari, on the other hand, stood at Sh2.2 billion over the same period, while the average value of loans increased 26 per cent to Sh5,575. Safaricom launched Fuliza in January 2019 as an overdraft facility that allows M-Pesa users to complete transactions when they run out of funds in their M-Pesa mobile wallets. M-Shwari was launched in 2012.  

Customers repay Fuliza overdrafts automatically when they deposit or receive money in their M-Pesa. This gives the service a near-100 per cent repayment rate compared to M-Shwari and KCB M-Pesa, where customers are prompted to make repayments.   

According to the telco’s Sustainable Business Report, the company contributed Sh557 billion to the economy in the 2020/2021 financial year, translating to 5.2 per cent of Kenya’s Gross Domestic Product (GDP).

The report further indicates that the company provided 190,273 direct and indirect jobs during the year and over one million jobs if the wider effects to the economy were included.