New Loan Product Offers a Lifeline to Squeezed Borrowers

Secured loans provider Mwananchi Credit has launched a new product that seeks to help customers effectively manage their loans without straining themselves.

The Switch and Save loan product enables customers servicing loans and unable to reach favourable terms with their lenders to transfer the credit facility to Mwananchi Credit, which takes it up under more favourable terms.

“Other lenders are not listening to consumers and we are coming in to offer the much-needed relief to borrowers serving loans and in need of more cash,” says Mwananchi Credit CEO Dennis Mombo.

Customers who switch their loans to Mwananchi Credit will enjoy a 10% cashback on repayments, which is then used to top up repayment of their loan. Besides, customers switching loans are allowed to pay back interest only for three months to allow them time to reorganize their finances.

It is understood that most credit providers are only restructuring loans but not offering the much-needed relief for borrowers hit by the Covid-19 economic disruption. Focused is more on managing risk than helping customers cope with the current economic crisis, leaving most Kenyans choking on debt and exposed to auctioneers.

While credit providers have been talking about relaxing terms, behind the scenes they are harassing customers and repossessing properties used to secure loans.

Mwananchi Credit intervenes by resetting the credit facility to the original loans and charges lower interest than the previous lenders, which gives borrowers not only breathing space but, more importantly, access to more cash.

Playing fair game

“We are customizing all loans,” Mombo says. “If, say, a civil servant is servicing a Ksh1 million loan and paying Ksh30,000 per month, we can take up the loan and reset it back to Ksh1 million under easy-to-manage terms,” says Mombo.

He said Mwananchi Credit is not repossessing cars used to secure loans, but instead reaching out to clients to understand their financial situations and find a mutual solution for genuine cases. 

“It’s not good to maximize profit on the misfortunes of people like everyone is doing,” Mombo says. “For us it’s time to give back to our customers. If we help them today they will support us in future.”

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