In Kenya, mobile money has revolutionized banking, making it easier and more convenient for people to access financial services. One of the leading mobile money lenders in the country is KCB Mpesa, a partnership between Kenya Commercial Bank (KCB) and Safaricom. In this blog post, we’ll take a closer look at KCB Mpesa Loan and everything you need to know about it.
What is KCB M-pesa Loan?
It is a mobile-based loan facility that allows Safaricom M-pesa customers to access loans ranging from KES 50 to KES 1 million.
The loans are disbursed through Mpesa, and the repayment period ranges from 1 month to 6 months.
The loan amount and repayment period are determined by the customer’s creditworthiness, which is determined by the customer’s Mpesa transaction history.
How to apply for KCB Mpesa Loan
To apply for KCB Mpesa Loan, one must be a registered Safaricom Mpesa customer. The loan application process is simple and straightforward, and can be done in the following steps:
The loan amount ranges from Kshs. 50 to Kshs. 1 million and is payable within a period of 1 month to 6 months.
To apply for a KCB M-pesa loan, follow the following steps:
Step 1: Dial *844# on your Safaricom line and select “Loans”
Step 2: Select “KCB M-pesa”
Step 3: Select “Request Loan”
Step 4: Choose the loan amount you want to borrow
Step 5: Select the repayment period
Step 6: Enter your Mpesa PIN to confirm the loan request
Step 7: You will receive a confirmation message from Safaricom and KCB Bank
Once your loan is approved, the funds will be disbursed directly to your Mpesa account.
KCB Loan Repayment Form
Enter the loan details and your bank account number to make a repayment.
How to repay your KCB Mpesa loan
There are several ways you can repay your KCB M-pesa loan. These include:
- Using Mpesa
To repay your KCB M-pesa loan using Mpesa, follow these steps:
Step 1: Go to your Mpesa menu.
Step 2: Select “Lipa na Mpesa”
Step 3: Select “Pay Bill”
Step 4: Enter KCB Mpesa Paybill number 522522
Step 5: Enter your KCB Mpesa account number
Step 6: Enter the amount you want to repay
Step 7: Enter your Mpesa PIN
Step 8: Press OK to complete the transaction
- Using KCB Mpesa menu
To repay your loan using the KCB Mpesa menu, follow these steps:
Step 1: Dial *844# on your Safaricom line
Step 2: Select “Loans”
Step 3: Select “KCB Mpesa”
Step 4: Select “Repay Loan”
Step 5: Enter the amount you want to repay
Step 6: Press OK to complete the transaction
- Using KCB Bank branches
To repay your loan using KCB Bank branches, follow these steps:
Step 1: Visit any KCB Bank branch
Step 2: Inform the bank teller that you want to repay your KCB M-pesa loan
Step 3: Provide your KCB M-pesa account number
Step 4: Make the repayment
- Using KCB Mobi Bank
To repay your KCB loan using KCB Mobi Bank, follow these steps:
Step 1: Download the KCB Mobi Bank app from Google Play or App Store
Step 2: Log in to your account
Step 3: Select “Loans”
Step 4: Select “KCB Mpesa”
Step 5: Select “Repay Loan”
Step 6: Enter the amount you want to repay
Step 7: Press OK to complete the transaction
Repaying your KCB Mpesa loan is easy and convenient.
You can use Mpesa, KCB Mpesa menu, KCB Bank branches, or KCB Mobi Bank to repay your loan.
Ensure that you repay your loan on time to avoid penalties and negative credit scores.
Two types of KCB Mpesa savings accounts
Fixed Savings Account, and the Target Savings Account.
1. Fixed Savings Account
The Fixed Savings Account is a type of KCB Mpesa account that allows users to save a fixed amount of money for a specific period. The minimum amount that can be saved in the account is Ksh. 50, and the maximum amount is Ksh. 1,000,000. The account has a fixed period of between 1 to 12 months, and the interest rate ranges from 2% to 6% per annum, depending on the duration of the fixed period.
To open a Fixed Savings Account, one needs to have an active Mpesa account and KCB Mpesa account.
Create your Fixed Savings Account effortlessly by following these simple steps:
- Go to the M-PESA menu
- Choose the “Loans and Savings” option
- Select KCB M-PESA
- Click on “Fixed Savings Account”
- Select “Fixed deposit”
- Open your account
- Choose your preferred source of funds:
b. KCB M-PESA
- Input the amount you want to save (minimum KES 500)
- Choose a savings period of 1 to 12 months
- Enter your M-PESA PIN and confirm the transaction
- You will receive a confirmation message from M-PESA.
The Fixed Savings Account is an excellent option for people who have a specific saving goal, such as saving for school fees or a down payment for a car or a home. It is also a great way to earn interest on your savings, which can help you grow your money over time.
2. Target Savings Account
The Target Savings Account is a type of KCB Mpesa account that allows users to save towards a specific target. The minimum amount that can be saved in the account is Ksh. 50, and the maximum amount is Ksh. 1,000,000. The account has no fixed period, and the interest rate is 2% per annum.
To open a Target Savings Account, one needs to have an active Mpesa account and KCB Mpesa account. The process of opening the account is simple:
To open a Target Savings Account on KCB M-PESA, follow these simple steps:
- Go to your M-PESA menu.
- Select Loans and Savings.
- Choose KCB M-PESA.
- Select Fixed Savings.
- Select Target Savings Account.
- Click on Open Account.
- Select your preferred source of funds – either M-PESA or KCB M-PESA.
- Enter the target amount that you intend to save for the period. The amount should be more than KES 1000.
- Enter the period of your savings, which can be from 1 up to 12 months.
- Enter your initial deposit amount, which should not be less than KES 50.
- Enter your M-PESA PIN and confirm the transaction.
- You will receive an M-PESA confirmation once the transaction is successful.
KCB Mpesa Loan has several benefits that make it a popular loan facility among Safaricom Mpesa customers. These benefits include:
- Accessibility: It is accessible to anyone with a Safaricom line, making it a convenient option for those who may not have access to traditional banking services.
- Quick disbursement: The loan is disbursed directly to your Mpesa account, which means you can access the funds instantly.
- Competitive interest rates: KCB offers competitive interest rates, making it an affordable option for those in need of quick cash.
- Flexible repayment terms: The loan repayment period ranges from 1 month to 6 months, giving customers the flexibility to choose a repayment period that works for them.
- No collateral required: The Loan does not require any collateral, making it an accessible option for those who may not have assets to pledge as security.
- Another feature of the loan is that it has a low interest rate of 1.16% per month. This makes it one of the most affordable mobile loan products in Kenya. The loan also has a flexible repayment period of up to 6 months, giving borrowers enough time to repay the loan without incurring any penalties.
How to Grow your KCB Mpesa loan limit
As a borrower, you may be wondering how to increase your loan limit.
Whether you need a larger loan amount to finance your business or personal needs, growing your KCB M-pesa loan limit is essential.
Fortunately, there are several steps you can take to increase your loan limit and access more funds.
Without further ado here is how to grow your KCB Mpesa loan limit
.1. Maintain a good credit score
One of the most important factors that determine your KCB M-pesa loan limit is your credit score.
A good credit score shows that you are a responsible borrower who is likely to repay their loans on time.
To maintain a good credit score, make sure you pay all your bills and loans on time, avoid defaulting on loans, and keep your credit card balance low.
2. Use KCB M-pesa regularly
Another way to increase your KCB Mpesa loan limit is to use the service regularly.
This shows that you are a loyal customer who uses the service responsibly. Make sure you use KCB M-pesa to pay bills, send and receive money, and repay loans.
This will help you build a good relationship with the lender and increase your loan limit.
3. Repay loans on time
If you have borrowed the lender before, make sure you repay it on time.
This shows that you are a responsible borrower who can be trusted with a larger loan amount.
Late or missed payments can negatively impact your credit score and reduce your chances of getting a larger loan amount in the future.
4. Increase your income
Your income is another factor that determines your KCB Mpesa loan limit. If you can increase your income, you will be able to borrow a larger loan amount.
Consider taking on a side gig, freelancing, or starting a small business to increase your income.
5. Build a savings history
Saving regularly can also help you increase your KCB M-pesa loan limit.
This shows that you are financially responsible and can manage your money well. Consider opening a savings account and setting aside a portion of your income each month.
However, growing your loan limit requires discipline, responsibility, and good financial habits.
Therefore, maintaining a good credit score, using KCB M-pesa regularly, repaying loans on time, increasing your income, and building a savings history, you can increase your loan limit and access more funds.
Keep in mind that growing your loan limit takes time, so be patient and persistent in your efforts.
Read Also: Their terms and Conditions
But how do you check your KCB Mpesa loan limit?
Here are simple steps you can follow to check your KCB Mpesa loan limit:
Step 1: Dial *844#
To check your KCB Mpesa loan limit, you need to start by dialing *844# on your mobile phone. This will bring up the KCB Mpesa menu.
Step 2: Select “Loans and Savings”
Once you’re on the KCB Mpesa menu, select “Loans and Savings” by entering the corresponding number and pressing send.
Step 3: Select “Loans”
Next, select “Loans” from the Loans and Savings menu.
Step 4: Select “Check Loan Limit”
From the Loans menu, select “Check Loan Limit” to check your KCB Mpesa loan limit.
Step 5: Enter your Mpesa PIN
You’ll be prompted to enter your Mpesa PIN to complete the loan limit check. Enter your PIN and press send.
Step 6: Receive your loan limit
Once you’ve entered your PIN, you’ll receive a message with your KCB Mpesa loan limit. This will let you know how much you may be eligible to borrow.
Checking your KCB Mpesa loan limit is a quick and easy process.
By following the steps outlined above, you can quickly determine your eligibility for a loan.
Defaulting on KCB Mpesa Loans: The Consequences
- Legal Action: KCB has the right to take legal action against defaulters. This can lead to a court order for repayment, which can be enforced through wage garnishment, property seizure or auction, or bank account freezing.
- Credit Score Damage: Defaulting on a KCB Mpesa loan can damage your credit score, making it difficult to access credit in the future. A damaged credit score can also lead to higher interest rates and unfavorable credit terms.
- Blacklisting: KCB can also blacklist you from accessing credit in the future. This means that you may not be able to access loans from other lenders, including banks, microfinance institutions, and other mobile lenders.
- Loss of Collateral: If you secured your loan with collateral, such as a vehicle or property, defaulting on the loan could lead to the loss of your collateral.
- Harassment: KCB may resort to harassment to recover the loan. This can include sending debt collectors to your place of work or home, making threatening phone calls, or sending threatening messages.
How to Avoid or Mitigate the Consequences of Defaulting on KCB Mpesa Loans
- Plan your finances: Before taking out a KCB loan, ensure that you have a plan for repayment. This means assessing your income, expenses, and any other financial obligations to determine whether you can afford the loan.
- Communicate with KCB: If you’re having difficulty repaying your the loan, communicate with the bank as early as possible. KCB may be willing to work out a repayment plan or restructure the loan to make it more affordable.
- Refinance the loan: You may be able to refinance your KCB loan by taking out a loan from another lender with more favorable terms and using it to repay the KCB loan.
- Seek debt counseling: If you’re struggling with debt, seek debt counseling from a reputable organization. They can help you develop a plan to pay off your debts and avoid defaulting on loans in the future.
KCB Mpesa loans are a convenient and accessible form of credit for many Kenyans. However, defaulting on these loans can have serious consequences, including legal action, credit score damage, blacklisting, loss of collateral, and harassment. To avoid or mitigate these consequences, plan your finances, communicate with KCB, refinance the loan, and seek debt counseling if necessary.
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