When mentioning the most significant innovations of the 2010s in Kenya, KCB M-PESA is among the top ones. This revolutionary service allows users to save, transact and borrow money using easy steps on their mobile phones. But just like all mobile money platforms, this service has a limit. Can you improve your credit score? And if so, is there an easy fix on how to increase your KCB M-PESA loan limit?
If you are looking for a platform to save and borrow money without much hassle, KCB M-PESA has you covered. The service offers a seamless integration of banking services with mobile technology, enabling you to manage your finances at your fingertips. But sometimes, you might find that your borrowing limit is fixed or lower than expected.
What is KCB M-PESA?
KCB M-PESA loan facility, launched in March 2015, is a mobile-based banking service for M-PESA customers that allows users to save and borrow money from their phones. Through the service, users can:
- Save and borrow: Users can deposit money into a fixed deposit or target savings account at an interest rate of over 6 per cent per annum.
- Deposit and withdraw: Users can deposit up to Ksh 150,000 into KCB M-PESA savings in one go. They can use the money to transact various services.
- Access loans: Users can access cash from as low as Ksh 50 and up to Ksh 1 million. Users receive the funds in their KCB M-PESA account. The repayment period is 30 days, and users can make the loan repayment through M-PESA or from their KCB M-PESA account.
To activate your account, go to your M-PESA menu, select 'Loans & Savings', select 'KCB M-PESA', and click on 'Activate'.
How to increase your KCB M-PESA loan limit
Once you opt into the platform, there are various services you can access, including getting loans. However, the creditor limits your loan based on the usage of your account. But is there a way to grow the KCB M-PESA loan limit? Here are four tips that might help.
1. Regularly use KCB M-PESA services
The more you transact with KCB M-PESA, the more likely your credit score will increase. The main reason is that the platform evaluates your transaction history to determine your creditworthiness. By frequently using their services for deposits, withdrawals, and payments, you demonstrate consistent financial activity, which can lead to a higher loan limit.
2. Promptly repay your loans
Repaying your loans on time increases your limit, while late repayments negatively affect your limit. Promptly repaying borrowed funds is crucial as it also enhances your credit score. A good credit score can open up opportunities for higher loan limits in the future. Moreover, it reflects positively on your financial discipline, making you a trustworthy borrower in the eyes of lenders.
3. Increase your savings with KCB M-PESA
If you regularly deposit money into your KCB M-PESA account, then you will receive a higher funding limit. A higher savings balance may lead to a higher loan limit because it demonstrates your financial stability to the lender. As a result, this consistent saving behaviour can positively influence your credit score.
4. Maintain a good transaction history
Maintaining a good transaction history involves how you use other M-PESA services. For example, borrowing and repaying your Fuliza on time creates creditworthiness for the lender. Also, avoid defaulting on other money lending apps, as it could result in your name being forwarded to the CRB, thus affecting your creditworthiness.
Why is my KCB M-PESA loan limit zero?
There could be several reasons why your KCB M-PESA loan limit is 0. They include:
- Multiple account registrations: KCB M-PESA prohibits multiple account registrations with the same document ID. The platform also assigns a zero loan limit to customers with less than six months of M-PESA history.
- Insufficient M-PESA transaction history: The platform closely scrutinizes your M-PESA transaction history to assess your financial behaviour. A sparse transaction history, marked by infrequent use for activities like purchasing airtime, sending money, or bill payments, can lead to a zero loan limit.
- Late repayment of previous loans: Timeliness in repaying your KCB M-PESA loan is crucial. If you've previously delayed or defaulted on a loan repayment, this negatively impacts your loan limit, potentially reducing it to zero.
What happens if you don't pay your KCB M-PESA loan on time?
If you don't repay your KCB M-PESA loan on time, you stand to suffer several consequences. First, your account will receive a lower credit limit, and in a worst-case scenario, you might need help accessing loans.
Secondly, if you default on your repayment for more than 90 days, the creditors will submit your name to the Credit Reference Bureau (CRB) for listing. Being referred to the CRB means that you will not be able to secure loans from other lenders in the future.
Finally, a late repayment has an additional fine, meaning that the creditor will charge you extra for failing to honour the terms of the payment agreement.
Wrapping up
If you are looking for ways to increase your KCB M-PESA loan limit, the guide above should help. Just like in many loan apps, the creditor limits the customer's credit score based on their transaction history. But there are other methods you can use to increase your loan limit, and the steps above will help you improve your limit.
Are you looking for information about how to increase your Fuliza limit? Tuko.co.ke featured an informative piece with details on how you could quickly increase your Fuliza loan limit.
Fuliza is a continuous overdraft facility that enables all subscribed Fuliza M-PESA users to complete financial transactions even when they have insufficient funds in their accounts. But just like most similar services, Fuliza has a limit. But is there a way to increase your limit?
