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Debt Collectors Will Be Used By Safaricom To Pursue Unpaid M-PESA Loans

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In its upcoming zero-interest credit program, Safaricom will use debt collectors to chase delinquent debts.

Customers will be able to order products and services on credit and pay later thanks to a new Safaricom offering called Faraja. Safaricom has been working to recover unpaid debts for years by placing defaulters on a blacklist with credit reference agencies (CRBs). A borrower’s credit rating is put at risk if they are reported to one of Kenya’s credit reference bureaus. Safaricom is now making greater attempts to improve repayment.

Safaricom in a statement:

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“At any time after an event of default has occurred which is continuing, we may, without prejudice to any other right or remedy granted to us under any law… take reasonable measures including engaging an independent debt-collection agency, to recover the amount in default (and/or) submit information concerning the event of default to Credit Reference Bureaus, subject to applicable laws,”

Debt collectors will be Used by Safaricom for Faraja Loans.

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Similar to a digital credit card, Faraja will let customers make purchases for as low as Sh200 and as much as Sh100,000. After that, they will be compelled to repay the same amount without any additional costs.

The Faraja account can only be used to pay for things via Lipa Na M-Pesa; it cannot be used to transmit money. Many businesses, including City Walk, Goodlife Pharmacy, and Naivas Supermarket, have already registered as merchants. Safaricom’s fees will be collected via the Lipa Na M-Pesa charges.

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“You will only be required to repay the outstanding facility amount as advanced to you by us (in whole or in part) using the designated Paybill number or such other channels as provided by us from time to time,” Safaricom.

The expenditures related to engaging debt collectors are also a part of the defaulters’ liabilities. If a Faraja account is in default, Safaricom will suspend it or delete it.

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Vanessa Waithera
Vanessa Waitherahttps://techmoran.com
Vanessa Waithera is a young writer from Daystar University. She has been a writer for 7 years and enjoys it as a hobby and passion. During her free time she enjoys nature walks, discoveries ,reading and takes pleasure in new challenges and experiences. Contact: [email protected]

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