Safaricom, KCB Launch ‘Fuliza Ya Biashara’ Overdraft Facility for Businesses

An overdraft facility has been launched by Safaricom and KCB Bank Kenya (KCB) to allow business owners to access goods on credit.

The ‘Fuliza ya Biashara’ will allow businesses on ‘Lipa Na M-PESA’ to complete payments even with insufficient funds in their till.

The credit facility will be applicable when withdrawing money to the designated number or at an agent, sending money to an individual, and making transactions from a Lipa Na M-PESA Business Till to other Till Numbers and PayBill Numbers.

The service would give users a 24-hour interest-free overdraft advance of up to Sh400,000.

“We launched Lipa Na M-PESA as a way for businesses to conveniently receive cashless payments through their mobile phones, whenever they are,” Safaricom CEO Peter Ndegwa said.

“With more than 538,000 businesses accepting payments through the service, our strategy is to now go beyond collecting payments by providing business owners with tools to manage and grow their businesses,” Ndegwa added.

“Fuliza ya Biashara caters especially to small businesses by providing them with instant, affordable credit of up to KSh. 400,000, empowering them to rapidly respond to their business needs.”

The M-PESA Business App and the Lipa Na M-PESA Transacting Till will both offer Fuliza ya Biashara.

A minimum overdraft of Sh1,000 and numerous overdrafts totaling up to Sh400,000 are available to business owners, depending on their designated limit.

The overdraft is immediately recovered from incoming till payments, and any funds left over after 24 hours are subject to a daily access fee of 2 percent for a maximum of 29 days.

Every time a repayment is made, the Fuliza ya Biashara limit is reset, allowing business owners to promptly access new overdrafts, including the sum they recently repaid.

“This proposition once again signifies the immense opportunities available within the digital ecosystem managed by KCB and Safaricom,” KCB Bank Kenya Managing Director Annastacia Kimtai said.

“We believe that the roll-out of this exciting feature will give Kenyan entrepreneurs the headroom to scale up their business operations without getting into the danger of not servicing some of their critical needs like payments to suppliers,” she added.

“As a partner, KCB will conveniently provide the much-needed support to guarantee scalability and access across its various customer delivery touchpoints.”

The facility, according to the two companies, aims to fill the gap in accessible credit for high-risk small- and micro businesses.

The solution gives each firm a customized overdraft limit based on Lipa Na M-PESA transaction history and past overdraft payback history.

The most recent in a series of platform advancements aimed toward business owners, Fuliza ya Biashara is M-PESA’s first credit solution specifically designed for enterprises.

With the introduction of the Lipa Na M-PESA Business Till and M-PESA Business App in 2020, businesses will be able to accept payments through tills and manage their cash flow more easily through the app.

The M-PESA Business App has been downloaded by more than 390,000 companies, and it handles more than 50% of all business transactions on M-PESA.