Number of Kenyans listed on CRB hits 3.2 million

CRB Kenya: The number of Kenyans listed on credit reference bureaus has hit 3.2 million. This is a jump from the 2.7 million Kenyans who were listed in the CRB last year. The listing in the CRB represents a 12 per cent rise in non-performing loans in Kenya up from 9.5 per cent in the year 2017.

Of the 2.7 million who were listed in the CRB in 2017, more than 400,000 people have been blacklisted for defaulting on loans of Sh. 200 and below. 16.6 per cent of digital borrowers take up one loan to pay another, ensnaring them in a vicious cycle.

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Digital borrowers asking for low amounts (such as Sh. 200) were found to incur high costs to the point where when paying the principal and interest, they were likely to be in a worse off position than they were before the loan.

According to data from the Central Bank of Kenya (CBK), most of these defaults have been fueled by mobile digital borrowing and defaults.

Last month, President Uhuru Kenyatta directed that Kenyans who failed to pay their dues by April 1 should not be listed in the CRB. The directive did not cover at least 3 million Kenyans listed in CRB.

The President said, he has issued a “temporary suspension of the listing with Credit Reference Bureaus of any person, Micro, Small and Medium Enterprises (MSMES) and corporate entities whose loan account falls overdue or is in arrears, effective 1st April 2020.”

The millions on CRB reflect the disparity in the Kenyan economy and casts doubt on government figures of a growing economy. With the economy taking a beating from the ongoing coronavirus scourge, it now remains to be seen how borrowers and financial institutions will be affected, and whether the number of defaults will be higher post Covid-19. CRB Kenya.