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Review of Kenya's Loan Apps: Branch, Zenka & iPesa

There are more than 100 loan apps on Google Play Store offering unsecured loans to Kenyans. Majority of the loan apps are insanely expensive while others lack the basic features of a loan app as their purpose is to profit from Google ads. These phoney loan apps can be singled out on how poorly they're structured, and the indefinite waiting for their approval.

Generally, loans apps can be categorized into three groups:

  1. Bank loan apps e.g. Timiza
  2. Telecommunication loan apps e.g. Mshwari
  3. Digital loan apps e.g. Branch, Tala and Zenka

Below is a brief information and my experience with three digital loan apps I had sought for their loan services: Zenka, Branch and iPesa.

Money Finance

Money Finance

a) Zenka Loan App

The loan app is operated by Zenka Finance Limited.

Amount of loan offered: Kshs. 500 - Kshs. 30,000.

Amount of time to repay loan: 30 days to 180 days.

Processing fee: A one-time charge of 9% - 30% (Kshs. 45 - Kshs. 870) of the approved principal amount.

Minimum Annual Percentage Rate: 70.7%

Maximum Annual Percentage Rate: 224.89%

Late payment fees: 1% daily from the outstanding balance

Repayment of loan: On their app or through their M-pesa Paybill number 979988.

If you're unable to repay a loan offered by the fintech company on time, you can extend the repayment of the loan for 7, 14 or 30 days. The maximum extension length is 12 months.

How to access their loan: On the Google Play Store, on their website, or through a USSD code.

The Zenka loan app has been downloaded over 100,000,000 times on Google Play Store. They have a star rating of 4.0. Other than a few glitches experienced in accessing their app and the high interest they charge on their loan, most of the 67,000 reviews on their app are positive.

Signing up on the app is easy. They don't require much information from an individual. The information they require is: an individual's first and last name, their phone and National ID number.

You can also register for their loan services through USSD code *841#.

My experience:

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Having downloaded their app, signing up and filling their form took less than 2 minutes. I was offered a fixed minimum or initial loan amount which I was expected to repay withing a month. I received the loan in less than a minute on my M-pesa number.

I repaid the loan on time. I requested for a second loan which was approved. The loan amount offered was higher, about 2.5 times of the initial amount. I was offered two options to repay the second loan - withing a month or two months.

My anticipation of repaying the loan withing one month of receiving it were squashed. As a result, I requested for an extension by pressing 'Need More Time to Repay' button on their app.

Several comments on Zenka's Facebook page and on Google Play Store suggest that the company doesn't offer third loans. This is despite an individual having repaid their loan on time.

Approval rate: Impressive

Approved Finance

Approved Finance

b) Branch Loan App

Branch loan app is operated by Branch International. The fintech company offers its loan services through mobile payment in Tanzania, Kenya, Nigeria, and India.

The Branch loan app is one of the most accessed loan apps in Kenya. There are more than 10 millions installs on Google Play Store. The app has a rating of 4.6. The more than 230,000 reviews are majorly positive.

Loan amount offered: Kshs. 250 - Kshs. 70,000

Monthly interest rate: 1.6% - 20%

Annual Percentage Rate: 22% - 240%

Repayable time: 30 days - 180 days

Late payment charge: Not applicable

Rollover (extension) fees: Not applicable

They offer loan services solely through their loan app which is available on Google Play Store.

Signing up and filling their form is simple. Similar to Zenka, they don't require much information from an individual.

My experience:

Signing up on the loan app and registering was super fast. It took less than two minutes. The fixed initial loan amount was disbursed in less than minute.

You are required to repay their loan within the time frame indicated on their app. The timeframe varies depending on the loan amount offered. It can range from a few days to a month, and so on. If you repay earlier than the rescheduled time shown on their app, your next requested loan will be lower.

You can repay their loan through their app or M-pesa Paybill number 998608.

Approval rate: Impressive

c) iPesa Loan App

The loan app is operated by Xcredit.

The app has been downloaded more than 1,000,000 times on the Google Play Store.

Star rating on Google Play Store: 3.7

Reviews of the app on Google Play Store: More than 33,000

Loan amount offered: Kshs. 500 - Kshs. 1,000,000

Loan term: 7 days - 180 days

Maximum Annual Percentage Rate: 36% - 72%

Average interest rate: 12% APR

Late fees: 2% daily of the principal outstanding balance

My experience:

After having downloaded the loan app, I registered my details on their app, and was offered a fixed initial amount which I was required to repay within 7 days.

A fixed loan amount - lacking a choice of loan amounts to choose from is displayed on their app once you've successfully registered with them. The loan amount is a sum of the principal loan amount and the interest rate charged on the loan.

Unlike Zenka and Branch, registering on iPesa loan app takes quite some time as there are many questions asked on their registration form. Even so, it won't take you more than 3 minutes. With Zenka and Branch, it takes less than a minute to register on their app.

I had a horrible experience from the staff of iPesa. My advice to those who seek a loan from iPesa is to exhaust other legit loan apps before requesting one from this company.

Four days before the due date, I received a message containing an offer of increase of my loan amount if I repaid my loan on that day. I didn't. From then I received threatening messages both on the Message and WhatsApp apps.

One wonders whether the company operating iPesa loan app is a legit digital lending company. It appears as if it's made up by a bunch of people congregated in a room who engage in a brainless activity of sending senseless messages to their customers so as to impel them to repay their loan before the due date. Offering unsecured loan is risky, but it doesn't mean they've to engage in unprofessional and unethical means of getting back one's money. It beats the purpose of offering loan services when you also factor how expensive it is to receive a loan from them. It's as if they don't understand what 'due date' entails.

Below are some of the complaints on their app on Google Play Store from people who sought their emergency funds services.

  • "Don't install! If you are looking for a loan, this should be the last place to look. Very uncouth; unprofessional and unethical staff. They call you on the 12th day of your 14-day loan and issue you with all manner of threats, including calling everyone on your contact list "
  • "Poor customer service and very unprofessional. Agents are rude and coarse you to pay way ahead of the deadline so they can collect commissions, and if you don't they threaten and abuse you through all communication channels, including stalking you on WhatsApp and downloading your pictures with the threat of posting them together with the ID number on social media. Don't use this, no matter how stuck you are."
  • "Very rude and unprofessional staff. Their help line number never goes through, staff calling you before your due date mocking you saying that you have no money. Calling you poor. Very unprofessional."
  • "This is another horrible and useless loan app. The agents are so rude, they start calling even before due date to threaten you. Some are so unprofessional they even send you messages of other customers we have made their payments already. The agents are so rude, unprofessional and useless. They are so abusive. Will never advice anyone."

Note: Always borrow or choose a loan amount you can repay on time. You don't want your credit score to be affected which is used to determine the loan amount that should be offered to you, and the interest rate to be charged on the loan. Additionally, you don't want to be backlisted from borrowing from other lending institutions, including banks.

This content is accurate and true to the best of the author’s knowledge and is not meant to substitute for formal and individualized advice from a qualified professional.

© 2022 Alianess Benny Njuguna

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