List of Peer to Peer Lending Platforms in Kenya

Simon Mwangi

Have you ever wondered whether there is Peer to Peer lending platforms in Kenya? If so, we are here to discuss Kenya’s top peer-to-peer lending platforms.

In this article, we will look at;

  • What is a peer to peer lending in Kenya?
  • The best platforms for peer-to-peer lending
  • How does Peer Peer Lending in Kenya Work?

Let’s delve into the details below.

What is Peer to Peer lending?

Peer to Peer lending (p2p) is a platform for lenders to access funding outside banking institutions. Before the advent of technology, this happened a lot within Chama’s and Merry-go-rounds.

However, with technology adoption in Kenya, online platforms have been established that connect lenders to borrowers.

Investors in platforms are everyday people who have extra cash in their hands and are willing to lend it to others and earn some interest in the process.

Now that we understand Kenya’s peer lending platforms, let’s look at the best platforms.

Peer to Peer Lending works differently from how banks work. Borrowers are matched directly to the lenders through the lending platform. Lenders make a profit through the fees charged by the lending platform and a percentage of interest.

Why borrow on Peer to Peer Lending Platforms?

Here is why you should borrow from a peer-to-peer lending platform.

  1. Everything is done online, and it’s fast.
  2. You do not have to give security for a loan, as most loans are unsecured.
  3. Lower or sometimes no interest charges.
  4. Automatic repayments
  5. Funds can be used for another reason other than the one borrowed without any need for approval as long as repayments are made.

Peer to Peer lending Platforms in Kenya

There are several platforms in Kenya offering this type of lending in Kenya. Each platform charges varying interest rates and has different terms and conditions.

Below we will outline the best of these platforms.

1. Zidisha

Zidisha is a lending platform in Kenya that enables people to lend small amounts of money to entrepreneurs. At Zidisha, no third parties are involved as the money is transferred directly from the lender to the borrower.

Moreover, this platform allows the Lenders to communicate directly to the entrepreneurs they have lent money.

2. Kiva

Kiva is another platform that connects lenders to borrowers in Kenya. At Kiva, all the loans are extended to borrowers at a 0% interest charge.

As a result, the Kiva platform makes loans affordable to Kenyans who cannot access commercial banking institutions due to various limitations.

An entrepreneur can access up to KES 500,000 with a 0% interest rate.

3. Uba Pesa App

Uba Pesa is a platform developed by Kenyans for Kenyans. This platform was launched in Kenya in 2018 and has been operating since.

It is worth noting that Uba Pesa charges an interest rate on the loans extended to borrowers. However, the interest rates charged vary based on the repayment period agreed upon while borrowing.

The shorter the repayment period, the lower the interest rate charged and vice versa. The repayment periods are divided into 10 days, 20 days, and 30 days respectively.

Unlike Zidisha, which allows lenders and borrowers to communicate, Uba Pesa App does not allow this communication.

Moreover, a borrower using the Uba Pesa app can access multiple loans, unlike the other platforms that only offer one loan at a time.

4. WayHoty App

WayHoty is also an online lending platform in Kenya, just like Uba Pesa. Moreover, WayHoty offers more than Peer to Peer Lending in that it also offers working capital loans for small businesses and mobile loans.

To borrow from their platform, one has to meet the following criteria:

  • Be over 21 years of age.
  • Have a source of income
  • possess no criminal record
  • Be a Kenyan Citizen living in Kenya.

5. Pezesha

Pezesha is perhaps more revolutionized than all the other platforms listed above. As through Pezesha, one can borrow even without access to the internet.

One only has to send the word Apply through shortcode 22235 to be able to access the loan.

However, for borrowers to access their loans this way, they have already been vetted. Also, they must have taken at least one loan with Pezesha and paid it.

All loans offered are based on your credit score rating. Therefore, the higher your credit scores, the bigger your chances of accessing the loan.

Peer Lending in Kenya Conclusion

Now that we have looked at the best platforms in Kenya, it is important to read through each platform’s terms and conditions.

This way, you will only secure a loan that you can easily repay without straining much. Some platforms like Zidisha require weekly repayments, while others require monthly repayments.

Dependent on the type of business you operate, and with all this information, you can be able to choose the best platform to lend or borrow from.

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As a freelance writer with a background in banking and accounting, Simon has the financial know-how to produce quality content on various topics. His experience gives him a strong foundation in understanding complex financial concepts and communicating them in an easy-to-understand way.
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