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Showing posts from June, 2024

A Guide to Debt Consolidation

  Debt consolidation has become an increasingly popular financial strategy in Kenya for individuals looking to manage multiple debts effectively. Consolidation combines several debts into a single loan, helping you simplify your financial obligations, potentially reduce interest rates, and improve your financial health. This article explores how debt consolidation works in Kenya, its impact on loan costs and creditworthiness, and when it might be a good or bad idea. How Debt Consolidation Works Debt consolidation involves taking out a new loan to pay off multiple debts. This new loan comes with a single monthly instalment, which makes managing finances straightforward. Step-by-Step Debt Consolidation Process Assessment of Debts: You must evaluate all existing debts, including mobile, digital, bank, and SACCO loans, as well as any other outstanding financial obligations. Loan Application: You approach your bank's loan officer, Microfinance or SACCO, or a spec...

Digital Lenders Regulations in Kenya: What You Should Know

The rise of digital credit providers in Kenya since 2014 has transformed the financial sector, offering unprecedented access to credit for many Kenyans. Leveraging instant, automated, and remote processing of micro-loans, these providers make access to credit fast and convenient. However, the rapid growth of digital lending has also raised concerns about predatory practices and financial stability. In response, regulatory measures have continuously been introduced to ensure a fair and transparent lending environment. This article explores the regulation of digital credit providers in Kenya, the reasons behind these regulations, and what borrowers need to know before opening those apps. Why Kenyan Digital Lenders Succeeded Digital credit providers offer loans through online platforms and mobile apps, providing a convenient alternative to traditional banking services. Accessibility: These platforms have made credit more accessible to individuals who didn’t have access to banks, esp...

5 Factors Guiding Credit Operations in Kenya

Next time the loans officer at your bank declines to give you a loan, here could be the reason. In Kenya, credit and lending are influenced by a number of factors. Understanding these factors is crucial for you as a borrower to walk the financial space in the country effectively. This article thus delves into the five factors: interest rates, credit score, economic condition, fiscal regulations, and market competition that shape lending in Kenya. 200 shillings Kenyan Bank Note 1.     Interest Rates Interest rates are fundamental to Kenya's and other countries' credit and lending processes. The interest rate is the one that determines the cost of borrowing and the return on lending for the lender, making it significant for the decisions of both lenders and borrowers. Kenyan Monetary Policy:  The Central Bank of Kenya (CBK) is mandated by the c...