Mobile loans – How to choose the right lender

Mobile loans are the most preferred source of short-term credit in Kenya. The loans aim at bringing the payday closer – in fact, mobile lenders convert any day of the month to your payday.

The popularity of mobile loans has seen an increase in the number of lenders offering the loans in Kenya.

The increase in number of mobile loan lenders offering mpesa loans has seen emergence of unscrupulous lenders. The unscrupulous lenders either offer you loans with hidden charges or take your personal information and use it without your consent. For these reasons, you need to be very careful when choosing a mobile loan lender.

The following are some of the factors you need to consider when choosing a mpesa loan lender.

Does the lender have a physical office or address?

Although mobile loans are the most convenient sources of short-term funds, a credible lender should have an office in at least part of the country.

Having more branches in parts in different parts of the country adds to the credibility.

You can determine this information by checking the lenders’ website. A simple search on search engines like Google can also give you information about the lender’s physical address.

For how long has the lender been in existence?

A mobile money lender who has been in existence for long tends to be credible and reliable. If a lender has been in business for years and clients still trust them, it means he is both credible and reliable.

However, this does not mean that newer lenders are not credible. It only means that they have not demonstrated their credibility; are you really willing to experiment?

Does the lender have customer reviews?

These are reviews left by previous clients. Although reviews could be ‘cooked’, they are a perfect way to determine the reliability and credibility of a lender.

You can determine genuine reviews by checking for biases. If not biased, the reviews are likely to be authentic.

A lender that allows clients to leave reviews is a confident lender and thus credible.

Online reviews appear either on the lender’s app (on PlayStore/AppStore), website or on any other blog.

Is the application process straightforward?

Most mobile loan providers will have a straightforward application process. Do not trust a lender whose loan application procedure is complicated and unclear. Chances are there is information they are trying to conceal.

Are the terms and conditions clear?

Before applying for a mobile loan, check the lender’s terms of service. A good lender will have clear terms written in an easy-to-understand language. Most unscrupulous mpesa loan lenders will have their terms of service written in a complex legal language with the aim of creating loopholes.