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Co-op Bank Takes on Fuliza With Kamilisha Transaction Overdraft Loan Service

The new credit facility seeks to offer convenience and flexibility to customers by ensuring uninterrupted transactions

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Co op Bank Kalimisha Transaction
Kamilisha is one of the most affordable short-term loan options.
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Co-operative Bank, moving to meet growing demand for instant credit, has introduced a short-term loan overdraft that enables customers with insufficient funds to complete transactions.  The new credit facility, branded Kamilisha Transaction, seeks to offer convenience and flexibility to customers by ensuring uninterrupted transactions.

Kamilisha Transaction provides an overdraft of up to Ksh100,000, with the limit calculated based account transactions, salary deposits, or business turnover. “Your limit is refreshed monthly based on your account activity, repayment history, and eligibility criteria,” Co-operative Bank says about the product. “Good transaction patterns and timely repayments can help you qualify for higher limits.”

Co-op Bank’s Kamilisha is emerging as one of the most affordable short-term loan options.  A review of its rates shows that a borrower taking Ksh1,000 will pay total charges of Ksh84.34, covering access fees, taxes, insurance, and daily maintenance charges. The credit facility gives Safaricom’s Fuliza a run for its money, entering a niche that has been stimulated by growing appetite among Kenyans.

It breaks down as follows: Ksh20 in access fees, Ksh4 in excise duty, Ksh0.34 in insurance, and a Ksh2 daily charge for 30 days, adding up to Ksh60. This translates to a monthly credit life insurance premium of 0.034%, a daily maintenance fee of 0.2% on the outstanding balance, and a one-time access fee of 2% on the borrowed amount. The 20% excise tax applies to the access fee.

Kamilisha loans are repayable within 30 days.  Under the terms of the Kamilisha crdit, customers are free to make multiple withdrawals within 30 days of first use for salaried customers and 15 days for business customers if utilised within the approved limit.

Interestingly, you can still get a Kamilisha loan even with an existing loan with Co-op Bank.

According to the bank, the funds taken by a customer will be automatically recovered from subsequent inflows into the customer’s bank account.

In order to increase one’s limit, the bank advises customers to maintain active account usage and repay their Kamilisha balance on time.

How it Works

  • According to Co-op Bank, the new loan scheme is designed to integrate seamlessly with regular transactions.
  • If a customer attempts to make a payment without sufficient funds, s/he receives a prompt to complete the transaction using Kamilisha.
  • There’s no separate application process; it happens seamlessly during your transaction.
  • The system then displays the required amount to finalise the transaction, along with any applicable fees.  If the customer agrees, the transaction is processed immediately.
  • A confirmation SMS with the transaction details is then sent to the customer.

How to Opt in

  • Log in to the bank’s digital banking platform that is accessible via USSD or the bank’s mobile banking app
  • Select E-loans, then Select Kamilisha
  • Select Opt-in
  • Read and accept these Terms and Conditions
  • Confirm Opt-in

> Corporate Kenya Mourns Frank Ireri, a Towering Figure in Kenya’s Banking Sector

Written by
BT Reporter

editor [at] businesstoday.co.ke

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