Seventeen major digital lenders in the country under the banner of Digital Lenders Association of Kenya (DLAK) announced on Monday, April 6, their decision to waive late repayment fees as part of measures to cushion Kenyans from economic shocks occasioned by the Covid-19 pandemic.
The association observed that the daily incomes of their customers had been affected by the pandemic and, therefore, it was necessary to put in place measures to help them shoulder the burden.
Users will, however, have to get details of the waivers from respective digital lenders.
The announcement came even as it emerged that 3.2 million Kenyans were blacklisted by Credit Reference Bureaus (CRBs) for defaulting on loans, up from 2.17 million the previous year.
According to TransUnion Kenya CEO Billy Owino, a vast majority of the negative listings are for mobile loans, with the average loan amount owed by digital borrowers standing at Ksh2,500.
"As of Friday last week 3.2 million Kenyans were negatively listed against a total of 11 million records," he was quoted telling Business Daily on Monday, April 6.
President Uhuru Kenyatta had on March 25 directed the suspension of listing of defaulting borrowers with Credit Reference Bureaus (CRBs).
The order will cushion borrowers who fail to service loans due from April 1.
Central Bank Governor Patrick Njoroge had also announced that commercial banks would extend the repayment period for loans by up to one year in a bid to cushion borrowers from the effects of the pandemic.
“Banks will seek to provide relief to borrowers on their personal loans based on their individual circumstances arising from the pandemic. All personal loans that were current on March 2 will be eligible to consideration of extension for a period of upto one year,” he announced at State House, Nairobi on March 18.
Default rates are expected to keep rising due to the Covid-19 pandemic that has had a massive effect on many small businesses which have completely shut down.
Many employees depending on their salaries to service various loans have also found themselves without a steady income as many organizations lay off workers to survive the harsh economic conditions.
