M-Shwari, a mobile loan and savings product offered by Safaricom in partnership with NCBA (formerly CBA), has become a trusted tool for millions of Kenyans. It offers instant credit and an easy savings platform, all accessible directly from your phone via M-PESA. With no paperwork or bank visits required, M-Shwari is fast, convenient, and easy to use.
If you’ve already taken out a loan through M-Shwari, it’s essential to understand how to repay it correctly. Timely repayment helps avoid penalties and ensures that you maintain a good credit history. In this guide, we’ll take you through the steps on how to repay your M-Shwari loan, the importance of doing so, and tips to manage your loan effectively.
Step-by-Step Guide To Pay Your M-Shwari Loan
Paying off your M-Shwari loan is simple and can be done directly from your phone using the M-PESA menu. Here’s how you can repay your loan:
How To Repay Your M-Shwari Loan Using Your Phone
- Go to your M-PESA menu
Open your M-PESA menu on your phone. - Select Loans and Savings
Scroll down to the ‘Loans and Savings’ option. - Choose M-Shwari
From the menu, select ‘M-Shwari.’ - Select Loan
Click on the ‘Loan’ option to manage your M-Shwari loan. - Choose Pay Loan
Select the ‘Pay Loan’ option to initiate the repayment process. - Enter the amount you want to repay
Input the exact amount you wish to pay off. - Input your M-PESA PIN
Enter your M-PESA PIN for security. - Confirm and Submit
Confirm the payment details and press ‘OK.’ You will receive an SMS confirming that your payment has been successfully processed.
Once the payment is successful, the loan repayment will be reflected instantly on your M-Shwari account. The simplicity and speed of this process make it convenient to settle your loan anytime and from anywhere.
Understanding M-Shwari Loans Before You Apply
Before applying for an M-Shwari loan, it’s important to understand how the loan system works and what you need to qualify. Here are some key things you should know:
How To Qualify And Apply For A Loan
To qualify for an M-Shwari loan, you need to meet a few requirements:
- Be a registered Safaricom subscriber
You must be a Safaricom subscriber with an active M-PESA account. - Use M-PESA regularly
You should have used M-PESA for at least 6 months. Regular use of Safaricom services like calls, SMS, data, and M-PESA will improve your eligibility. - Save regularly on your M-Shwari account
Maintaining regular savings in your M-Shwari account increases your chances of qualifying for larger loan amounts.
To apply for an M-Shwari loan:
- Go to your M-PESA menu
Open your M-PESA menu on your phone. - Select Loans and Savings
Scroll to ‘Loans and Savings’ and choose ‘M-Shwari.’ - Select Loan then Request Loan
Click on ‘Loan’ and then select ‘Request Loan.’ - Enter the loan amount
Input the desired loan amount. - Input your M-PESA PIN
For security, you’ll need to enter your M-PESA PIN. - Confirm
After confirmation, you will receive a message informing you if your loan request was successful. If approved, the loan amount will be deposited directly into your M-PESA account.
M-Shwari loans have a flat facilitation fee of 7.5%, which is charged once per loan.
What Happens If You Delay Or Default On Your Loan
Repaying your M-Shwari loan on time is crucial to maintaining access to future credit and avoiding penalties. Here’s what happens if you delay or fail to repay your loan:
Penalties For Late Payment
- If you fail to pay within 30 days:
Your loan term will be extended by another 30 days, and you will incur an additional 7.5% facilitation fee on the remaining balance. - If you fail to repay within 120 days:
If you do not repay within 120 days, you may be listed on the Credit Reference Bureau (CRB). This negative listing can affect your ability to borrow from banks or other digital lenders in the future.
Tips To Manage Your M-Shwari Loan
Managing your M-Shwari loan wisely can help improve your credit score and make future borrowing easier. Here are some tips:
- Borrow only what you can comfortably repay within 30 days.
- Repay early to improve your credit limit. Early repayment can improve your chances of being granted higher loan limits in the future.
- Check your loan limit regularly. Dial *243# to check your loan limit and track your borrowing capacity.
- Save regularly on M-Shwari. Regular savings will improve your chances of qualifying for higher loan amounts.
Paying off your M-Shwari loan is straightforward and can be done anytime through the M-PESA menu on your phone. By repaying your loan on time, you avoid penalties, keep your credit record clean, and increase your chances of borrowing in the future. Remember to manage your loan wisely by borrowing only what you can repay and saving regularly to build your creditworthiness.
M-Shwari offers a convenient and accessible way to manage both loans and savings, making it an ideal solution for many Kenyans. By following the steps outlined above, you can ensure that your M-Shwari loan repayment process is hassle-free and efficient.
