Prime Bank has become the latest commercial bank to jump into Kenya’s competitive mobile loans space. The mid-sized retail bank will offer short-term mobile loans as it looks to tap into the mass market.
The product dubbed PrimeKopa will be available on the PrimeMobi mobile app. Loans from Ksh5,000 to Ksh150,000 will be available with repayment periods between 30 days to three months.
Funds will be disbursed instantly upon approval. Users will be able to make partial and early repayments of their loans.
“PrimeKopa seeks to provide customers access to mobile loans with flexibility in terms of repayment in a seamless, paperless, and digital manner. We believe PrimeKopa will offer customers a differentiated digital banking experience,” Managing Director Bharat Jani stated.
Prime Bank will be banking on mobile loans to grow its market share which stood at 2.44 percent as of December 31 according to Central Bank of Kenya (CBK) data. The bank’s customer deposits stood at Ksh88.59 billion and the loan book at Ksh44.53 billion.
While several major financial institutions have been involved in mobile lending, banks have accelerated development of digital financial services during the Covid-19 pandemic.
Standard Chartered unveiled its mobile lending service in July 2021 after receiving the Central Bank of Kenya (CBK) greenlight to operate as a digital micro-lender. Unlike other banks, however, StanChart expressed that it’s mobile loans strategy wasn’t centred on the mass market.
“It is not just about the traditional digital lending, but why can’t we be able to do everything digitally like apply for credit card and get a response or apply for a personal loan,” CEO Kariuki Ngari stated.
Other banks offering mobile loans including Tier-1 institutions Equity, KCB, NCBA and Co-op Bank.