When the government started to regulate interest rates charged on bank loans, it created an unintended consequence in the proliferation and massive growth of credit-only app-based loan vendors. Not even the lifting of the loan cap has blunted the reach of the lenders.
This is for the simple reason that through simplicity and efficiency, they cater for a lot of Kenyans that banks seldom reach out to. While mainstream bankers have roped in pretty everyone when it comes to taking deposits, a lot of people in need of credit, especially the youth and SMEs, have been sidelined because of lack of credit history or simply because they find banks unable to address their unique needs besides being overly bureaucratic when handling loan applications.
