Mobile lenders have suspended late payment fees to cushion customers whose incomes have been disrupted by the impact of the coronavirus shutdown.
The Digital Lenders Association of Kenya (DLAK), which represents 17 major digital lenders, says the relief will be communicated by respective providers.
“The move will cushion the customers who are under distress, following the slowdown in the economy after disruptions to their operations that could have had an effect on regular income flow,” the association said.
Tala, one of the members, charges eight percent of the remaining balance in fees for one week delays after which the payment is moved down two weeks.
The customer is downgraded to lower loan limits or may not get a subsequent loan.
Zenka applies late payment interest of one percent per day on the outstanding principal.
Okolea says borrowers who fail to repay on time are forwarded to debt collectors and the Credit Reference Bureaus (CRBs).
M-Shwari has offered distressed borrowers a month’s relief on late payment penalty.
Its borrowers will not be charged additional 7.5 percent fees if they roll over debt.
President Uhuru Kenyatta directed a suspension of listing with CRBs any persons and businesses whose loan accounts fall due or are in arrears.
TransUnion Credit Reference Bureau estimates that digital lenders make up 90 percent of the 3.2 million listed Kenyans.