Kenyans listed by CRB will receive a 50% discount, according to CBK.
Following the Central Bank of Kenya’s announcement of a plan to rebuild their credit standing, loan defaulters in Kenya who are listed by credit reference bureaus (CRBs) can breathe a sigh of relief.
A Credit Repair Framework was going to be implemented, according to a notice published by CBK on Monday, November 14, and intended to help mobile phone digital borrowers with their credit standing.
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The initiative was approved, according to the regulator, by commercial banks, microfinance institutions, and mortgage financing firms that provided loans to mobile phone customers.
On May 31, 2023, the exercise is set to end.
“Through the Framework, the institutions will provide a discount of at least fifty percent of the non-performing mobile phone digital loans outstanding as at end October 2022, and update the borrowers credit standing from non-performing to performing.
“The institution will then enter into a repayment plan with the borrowers for a period up to May 31, 2023, for the balance of the loan. Upon expiry of the Framework, the credit standing of the borrowers with respect to these loans will depend on their repayment performance during the six-month period,” read the statement in part.
The notice indicated that the framework will cover loans with a repayment period of 30 days or less and were offered by these institutions through mobile phones.
“It is anticipated that the Framework will enable over 4.2 million mobile phone digital borrowers, adversely listed with CRBs, to repair their credit standing.
“The total value is approximately Ksh.30 billion, equivalent to 0.8 percent of the gross banking sector loan portfolio of Ksh.3.6 trillion at end October 2022,” added the statement.
Kenyans listed by CRB will receive a 50% discount, according to CBK.
