One of the fastest-growing non-bank financial institutions in Kenya joins Mintos

09.03.2020

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Mwananchi – one of the most popular market players in Kenya launches on Mintos and offers to invest in car loans. Investors can expect to earn net annual returns of up to 12% for its loans listed in Euros. 

Mwananchi Credit Ltd is a micro-finance company that offers a wide range of tailor-made financial solutions for its customers to meet cash flow challenges faced by both individuals and small and medium enterprises (SMEs).

Mintos investors will be able to invest in car loans – the core product of the company. For car loans, the vehicle serves as collateral, and usually, the loan to the appraised value of the pledged vehicle is in the 30%-50% range. This means that even if the borrower fails to pay the credit payments, the unpaid principal can be recovered with a more attractive margin. The used car market is very active in Kenya and in vast majority cases, it takes less than 30 days to sell the car in the secondary market, recovering the lent funds.

Initially, Mwananchi started operations under the name Mwananchi Microlink Ltd which was incorporated on 15th April 2010. On 10th January 2012, it changed its name to Mwananchi Credit Limited. The company has grown its net loan portfolio to € 8.7 million and as of January 2020, has accumulated a total of 3 415 clients and disbursed more than 6 870 loans. The average loan amount is € 5 800 with an average term of 10 months. 

Mwananchi Credit is one of the most popular players in the alternative lending industry according to the Loan originator’s estimates. The company has embarked on an expansion plan which entails new product development and opening of new branches across the country. The expansion is envisioned to acquire 6 000 clients and open 6 new branches in 2020. They have launched a mobile lending app and they are in the process of digitizing their services. Later on, Mwananchi will also add other loan products from their portfolio. 

Mwananchi on Mintos

On Mintos, Mwananchi has received Mintos Rating of “B”. Investors can expect to earn net annual returns of up to 12%. 

When it comes to assessing the creditworthiness of clients, the company takes into consideration their previous loan repayment history and also their ability to pay loans. The credit history is checked by reviewing loan repayment history and by running Credit References Bureau (CRB) checks to ascertain if the client is negatively listed. The company is also adopting a scoring machine which can tell the credit score of the prospecting clients.

The company has 10% skin in the game and all loans come with a buyback guarantee.

Click here to see loans from Mwananchi on the Primary Market. If you are using Auto Invest, don’t forget to adjust your portfolio settings.

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