BUSINESS
Since digital lenders came to the scene some few years ago, millions of unbanked and even banked Kenyans have found somewhere to seek refuge whenever they need some quick cash to fix an emergency or the usual day-to-day financial needs.
However, some borrowers have found it an uphill task to secure these mobile loans as whichever lending app they run to, they are turned down for unexplained reasons. Below we explain why you could have found yourself in such a situation.
1. Time of borrowing
If you borrow money from some mobile lending applications between 7pm and 7am, you will probably come up empty, thats because research conducted by the lenders shows that most people who borrow during this time, use that money for consumption and not for constructive purposes, Business Today reports.
According to a financial expert that BT has spoken to, the conclusion was arrived at after observation that showed that borrowers keen on repaying back loans actually apply for credit between 7 am and 6 pm.
However, a number of OKash borrowers whom 254Newsday has spoken to seem to disagree with the expert's notion as they assert that this has never been an issue to them while borrowing from the OKash app even past midnight.
Download OKash here and instantly borrow up to Sh50,000 now and choose between 15, 22 or 29 days to repay at a fair interest rate.
2. Age of your sim card
Lenders also factor in how long a sim card has been operational as it gives them the confidence that you use that line frequently.
“A borrower stands zero chance of acquiring credit if their line is new, absolutely no chance, it is important for us to know that a borrower is reliable and that is one of the ways we determine that," the expert says as quoted by BT.
OKash is the quickest and easiest way to request short term loans from your mobile phone to your M-Pesa any time you are in need.
3. M-Pesa activity
Regular M-Pesa activity is another aspect that the lenders factor in, deposits and withdrawals from the mobile transfer service is also a credit scoring tool, it helps lenders determine how frequently you transact as a probability of you paying back your loan.
Whether you have been listed at any of Kenya's three Cedit Reference Bureaus is probably the most common method of credit scoring. Some borrowers are serial defaulters and have been listed at CRBs. Digital lenders can access data from CRBs before advancing credit helping them navigate the default risk.
4. Loan Repayment
The speed at which you repay back your previous loan keeps your credit score on the upward trajectory while increasing your loan limit. Late loan repayment affects your credit score and limit negatively while default lands you at the much feared jaws of CRBs.