A KCB salary advance loan is the go-for should you have any unforeseen financial needs. But who is this loan for, and how do you know whether you qualify?
In this article, we’ll answer these questions and more.
Perhaps you’ve just finished college and landed a job but lack the resources to sustain you through your first several months. Or have just had that medical emergency and no medical coverage or insurance.
A salary advance loan is a great option to get you started as you settle down and normalize. It takes off the loan of borrowing from friends or taking the tiring normal loan route.
If you’re experiencing such struggles or would just learn more about the salary advance loan, this article is for you.
KCB Bank Overview
KCB Bank is arguably Kenya’s oldest bank, with a history dating back to the 18th century. However, the bank adopted the name Kenya Commercial Bank in July 1970 under Kenya’s first president. At this time, the Kenyan Government acquired 60%, becoming the major shareholder.
KCB Bank has over 200 branches in Kenya, Uganda, Tanzania, Uganda, and South Sudan. As of May 2023, the bank became Kenya’s largest bank by asset size.
One of the products and services under the KCB Bank category is a salary advance loan.
KCB Salary Advance Loan Overview
For most people fresh out of college and on their first job, it can be challenging to manage the added expenses. Some common expenses of getting a new job in Kenya include transport and lunch expenses.
KCB Bank’s solution to this and other related problems is the Salary advance loan. The loan helps you get things rolling while waiting for the month’s salary. It cushions you from unforeseen financial needs.
Features and Benefits of KCB Salary Advance Loan
Taking a salary advance loan may be an excellent idea if you have just landed your job and are struggling to keep up with the monthly expenses. A salary advance loan can prove helpful in various situations and offer benefits such as:
Convenient and Flexible Access Funds
A normal KCB loan involves a lengthy application process. On the contrary, a salary advance loan is simpler and faster to access. You can apply and have your KCB salary advance loan approved within 7 days. And even better, there’s not much paperwork involved in the process.
Great for Emergencies
A salary advance loan can be helpful if you are salaried but don’t have an emergency fund. Whether you or your family members need urgent treatment or hospitalization, there’s no need to liquidate your investments and assets.
Flexible Repayment
KCB salary advance loans are usually aligned with your paydays. In addition, KCB lends you up to 100% of your salary at a maximum of Ksh. 100,000. Therefore, the loaned amount doesn’t take much of your salary.
Quick Disbursement of Funds
KCB processes and disburses salary advance loans within 24 hours. Other types of KCB loans may take weeks or even months before approval.
Low-Interest Rates
Salary advance loans have a CBR rate of 9% and a margin topping 4%, topping the interest rate at 13%. This rate allows you to save more on interest rates and only applies to the amount you draw.
No collateral is required: When applying for most bank loans, you must have saved with the bank or have an asset you can otherwise use as security. However, the salary advance loan requires no collateral or security.
Eligibility Criteria for KCB Salary Advance Loan
To apply for a salary advance loan, you must meet a set of standards. KCB bank requires that:
- Be an active bank account holder for a minimum of 3 months.
- Applicants must be employed and salaried.
- You must provide a valid Kenyan ID or Passport.
- Provide their latest original payslips.
- Loan limits and repayment terms
Salary advance loan is under the unsecured category, meaning you don’t need to provide any form of security when applying. KCB Bank limits the loan access to up to 100% of your salary or a maximum of Ksh. 100000. The limit is low because the loan is meant for unforeseen financial needs.
A salary advance loan repayment is between 1 to 6 months. The amount is deducted from your payslip every time of the month when it’s deposited. Partial payments are distributed monthly, but you can clear the amount fully.
How to Apply for KCB Salary Advance Loan
KCB salary advance loan doesn’t have the tiring documentation involved when applying for normal loans. First, you can check your eligibility by contacting KCB customer support. The agent may request you to share some documents, like a payslip, to counter-check.
Once the agents verify that you qualify for the salary advance loan, you can start the online application process.
Required Documentation
With the go-ahead, you can start preparing the documentation. As mentioned, you must provide payslips, an ID number, and other relevant documentation.
Verification and Approval Process
KCB salary advance loan is verified and approved fast and released within the shortest time possible. The timeframe is often within 24hrs but could extend, depending on your specific issue, to within 7 days. If the verification and approval process takes longer, consider contacting customer support.
Disbursement of Funds
Disbursement of your salary advance loan is immediately upon approval. More often than not, the bank doesn’t require more signatures for this loan upon its approval.
Tips for Responsible Borrowing of KCB Salary Advance Loan
Assessing your financial needs: Assessing your needs before taking the salary advance loan is important. Determine what exactly you want the money for.
Creating a budget and repayment plan: Once your loan is approved and the repayment schedule is defined, create a budget for how you will use your salary going forward. Budget a part of your monthly paycheck to pay the loan.
Avoiding overborrowing: Just because you qualify for a salary advance loan doesn’t mean you should borrow. Avoid overborrowing, as this could hook you into living paycheck to paycheck.
Timely Repayment and Consequences of Default
Like any other loan, the KCB salary advance loan has consequences should you default. But before you do, the KCB bank customer support team may first try contacting you. And depending on the reasons for your default, you can approach the bank with a negotiation proposal.
However, the consequences of defaulting on a salary advance loan lowers your credit score, fines, and penalties. This may damage your ability to borrow in the future. Defaulting for a long time may have your details forwarded to the Credit Reference Bureau (CRB).
Having your details forwarded to the CRB damages your long-term credit score. The CRB lists a defaulter for five years after their last payment. That may deem you risky for any loan applicant for five years.
Frequently Asked Questions about KCB Salary Advance Loan
How Do You Qualify for KCB Salary Advance?
You qualified for a KCB Bank salary advance loan if you’re salaried and your account is active for at least 3 months. However, the bank may need to look up a few other details before deeming you qualified. You can contact KCB Bank via email, call, or fill out the inquiry form on their website for more details.
How Long Does KCB Take to Process a Salary Advance Loan?
KCB Bank salary advance loan is processed within the shortest time possible, usually within 24 hours. However, sometimes, the loan may take 7 working days to process. Call or email the customer support team if your application takes longer than normal.
What Is the Maximum Salary Advance for KCB?
KCB Bank salary advance loan maximum limit is 100% of your salary or about Ksh. 100000. The bank offers you the limit that comes first, but depending on other past loan histories, the loan limit may be shorter than the previously mentioned limits.
Does Salary Advance Have Interest?
Yes, the KCB salary advance loan has an interest of 13% p.a; distributed into a CBR rate of 9% and a variable bank margin of 4%. The bank offers more details on other fees during the loan application process.
Conclusion
KCB Salary Advance Loan is one of the best options for salaried people, especially because it doesn’t need security or has a lot of documentation. What’s better, KCB Bank processes the loan faster than the normal loan and gives you access to up to 100% of your salary. It’s arguably the best KCB Bank loan for unforeseen financial needs.
Unlike others, a salary advance loan is processed and approved fast. If you’d love to understand the KCB Bank loan application comprehensively, check out our guide to learn more.
Want to share some of your thoughts on the KCB salary advance loan? Have you ever applied for an advance loan before? How was the interest?
Past CRB listing due to convid related lay offs, would it be a blocker to salary advance? Why?