Borrowers who default on their Sacco loans will now find themselves listed by local credit reference bureaus from this week.
This follows the coming to effect of a new law on amendments to the Finance Act of 2016. The amendments allow water, power, telecommunication firms to refer loan and bills defaulters to be referred to CRBs.
Currently, Kenya has three credit reference bureaus which include Metropol CRB, Transunion CRB, and Creditinfo CRB.
Stakeholders had mid last year termed the inclusion of utility companies such as Kenya Power, water firms, mobile operators and pay-TV service providers in credit sharing as a game changer saying it would boost the platform by providing a true picture of the prospective borrowers.
“The history of paying utility bills, like telephone, cable, electricity, or water, when they go in someone’s credit report would really be useful in providing the creditworthiness of prospective borrowers and giving a correct credit score,” said Metropol Credit Reference Bureau managing director Sam Omukoko in June.
“For us to start going in this direction, however, we need to have bills such as that of electricity in the name of individuals and not landlords.”
