In Kenya, M-Shwari and Fuliza have become the biggest lenders to SMEs

A new report by Kenya’s leading SMEs Research firm, Viffaconsult, has revealed that M-Shwari and Fuliza are now the biggest lenders to Kenyan Small and Medium Enterprises (SMEs). This implies that Tala and Branch which, before now, were the most readily available lending option to SMEs, are now relegated to fourth and fifth positions.

A copy of the report – Kenya SME Mobile Credit Finance 2020, which was seen by Business Elites Africa, noted that M-Shwari is now responsible for 36% of SMEs loans in Kenya, even as Fuliza accounts for 19%. Further details show that KCB-M-PESA is responsible for 16%, Tala 12%, Branch 6%, Okolea 5%, Eazzy Banking (Equity Bank) 4%, and Timiza (Barclays Bank) 2%.

Interestingly, Tala was the moat preferred lender just last year, followed by Branch, Mshwari, KCB M-PESA and then Fuliza. Most of these are fintech products owned by Safaricom, one of Kenya’s biggest telecom and mobile money services providers.

The report went further to note that Kenya SMEs have a penchant for frequenting fintech lending platforms, especially when they are in need of quick loans. Apparently, 79% of Kenyan SMEs access these fintechs’ lending platforms on a monthly basis, while 11% and 10% access them on a monthly and daily basis, respectively.

Meanwhile, despite this “access to finance remains the top challenge Kenyan SMEs face,” the report noted. Only about 28% of these SMEs are only able to access between Ksh5,001 and Ksh10, 000 from fintechs. Also, 17% of Kenyan SMEs borrow Ksh4,001 and Ksh5,000, while 16% of Kenyans borrow between Ksh0001 and Ksh20,000.

To supplement this, to look up to “family and friends, chama, SACCO, savings, retained profit, and banks,” the report said.