A new feature on M-Pesa dubbed Fuliza that allows users access an overdraft facility has garnered one million users in just eight days after it’s launch.
According to media reports, Safaricom Chief Executive Bob Collymore told Reuters that customers have borrowed over a billion shillings over 7 days.
Fuliza is a product from Commercial Bank of Africa and Safaricom. It was in part inspired by data that shows about 58 per cent of business transactions fail daily due to a lack of sufficient funds.The product is available to all M-Pesa users, and makes it possible for one to pay for goods and services via ‘Lipa na M-Pesa’ options or to send money even without sufficient funds.
The feature enables M-Pesa customers to send or complete mobile payment transactions even if the M-Pesa balance is below the required amount.
Collymore said users can draw down the overdraft facility until they reach their limit which is determined by an algorithm.
Customers are charged an access fee of 1 percent and a maintenance fee of between Sh2 and Sh30 per each day that the wallet remains overdrawn.
Whenever customers receive an inflow into their M-PESA wallet, the overdrawn position is deducted.
Fuliza complements the M-Pesa’s mobile credit feature, M-Shwari, which was introduced in 2012 and has over 25 million customers.
Kenya has over 50 registered mobile phone apps
Overdraft services have been available in traditional banks. The service has found its way to mobile money products, and it is obvious more companies will probably try and copy the new service.