Fuliza Overdraft: A month after Safaricom launched its overdraft service known as Fuliza, Kenyans have borrowed over Sh. 6.2 billion.
In the same period, Safaricom has signed up 4.2 million customers on the platform.
In the first eight days after launching Fuliza, Safaricom notched up one million users.
Started 11 years ago as a service to allow Kenyans without access to the banking network to transfer money via mobile phones, M-Pesa now offers loans and savings in conjunction with local banks, as well as merchant payments services.
Safaricom, part-owned by South Africa’s Vodacom and Britain’s Vodafone, launched the new overdraft feature called Fuliza on Jan. 7 this year.
“We got a million (customers) by day eight and by day eight we had lent $10 million. Now we are probably at $15 million,” CEO Bob Collymore said in January.
“If you don’t have enough cash, you simply draw down from the overdraft and you keep drawing down until you have got to your overdraft limit, which is predetermined by an algorithm.”
Fuliza is underwritten by Kenyan lenders KCB Group and CBA Group, which already had partnerships with Safaricom to offer short-term loans on the M-Pesa platform.
M-Pesa has around 20 million active users in Kenya and it has become the principal driver of profit growth for the dominant telecoms provider in East Africa, as revenue from traditional voice and text services has flattened off.
As the market leader with 65 percent of mobile phone users, or 30 million subscribers, Safaricom has long been dogged by regulatory proposals to clip its wings to boost competition.