A third of borrowers now on CRBs blacklist
Auctioneers carry away the property of a loan defaulter. A third of Kenyan loan accounts are negatively listed as defaulted with the country’s credit reference bureaus (CRBs) in an economy where Covid-induced job cuts and business closures have pushed thousands of people into a debt trap.
A third of Kenyan loan accounts are negatively listed as defaulted with the country’s credit reference bureaus (CRBs) in an economy where Covid-induced job cuts and business closures have pushed thousands of people into a debt trap.
Data from the CRBs show that the accounts negatively listed stood at 4.6 million out of the 15 million accounts, reflecting a jump from 3.2 million accounts in April last year.
The bulk of the new listings is for mobile digital loans despite the government having frozen the blacklisting of defaulted loans below Sh1,000 from April to December last year.
The suspension was aimed at cushioning Kenyans from the economic fallout that came with Covid-19.
The defaulted loan accounts were listed this year.
Workers and businesses defaulted on bank loans worth Sh93 billion in the year to February following the imposition of stringent measures to contain the spread of the coronavirus.
Data from the Central Bank of Kenya (CBK) shows that non-performing loans (NPLs) rose from Sh351 billion in February 2020 to Sh444 billion at the end of February this year — the sharpest one-year increase in recent history.
Read full story here.