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Relief for kenyans as safaricom announces 50 per cent reduction in Fuliza interest charges.

Borrowers of Fuliza will, from October 1, 2022, be freed of daily maintenance charges for transactions below Sh1,000 in the first three days of borrowing.This follows a review of Fuliza offers by telecommunications company Safaricom, NCBA, and KCB groups aimed at providing and empowering Kenyans with sustainable and affordable credit.

“So, for the first three days, customers will not have to pay a daily maintenance fee which they pay today.Customers will also enjoy reductions in daily maintenance fee for transactions above Sh1,000 up to Sh70,000,” Safaricom Chief Executive Officer Peter Ndegwa announced on Wednesday, September 28.


In the new changes, Safaricom will maintain the Fuliza access fee at the current 1 per cent including for transactions below Sh1,000.
“This establishes Fuliza as the most accessible and affordable credit facility at only one per cent of the transaction value,” Ndegwa said.


The Safaricom CEO, in an address at Norfork Hotel in Nairobi, noted that the changes in the review would cumulatively lead to a 50 per cent overall reduction in Fuliza tariffs.Fuliza, an M-Pesa service that allows customers to overdraw on their M-Pesa account when they have insufficient funds to complete a transaction, was launched in 2019, in a partnership involving Safaricom, NCBA Group, and the Kenya Commercial Bank (KCB) Group.


NCBA Chief Executive Officer John Gachora on Wednesday said a review of the borrowing data showed that the original intention of Fuliza was not being achieved.
“During the Covid-19 pandemic, we saw a surge in the number of customers accessing credit. We began observing the numbers… From the data, it is clear the original intent for Fuliza to be a short-term facility for four to seven days has evolved. Many customers’ M-pesa wallets are now remaining overdrawn for 14 to 19 days on average.We are announcing changes to the Fuliza proposition with the goal of amending it back to its original purpose. With the right use of Fuliza, customers will see a benefit in the cost of credit and borrowing experience,” said Gachora.


According to data, Kenyans borrowed Sh578 billion in 2021 amid rising inflation and economic hardships.The overdrafts, utilised between January and December 2021, translated to Sh1.58 billion daily borrowing, pointing to the increasing use of the service rolled out in 2019.

Article By Suzy Nyongesa.


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