Credit score scores for particular person debtors standing above good or 500 to 900 factors have climbed to 71 p.c or 16.3 million profiles
Particular person credit score scores have strengthened regardless of issues of elevated credit score dangers from rising rates of interest prior to now yr.
In keeping with knowledge from Metropol Credit score Reference Bureau, scores for particular person debtors standing above good or 500 to 900 factors have climbed to 71 p.c or 16.3 million profiles on the finish of February 2024 from 63 p.c at related time final yr.
Metropol, which is without doubt one of the credit score reference bureaus, says it has 23 million particular person/family profiles and 700,000 enterprise profiles.
The corporate attributed the improved scores to reforms in credit score data sharing which have seen monetary establishments begin sharing optimistic credit score knowledge with the bureaus.
“We’ve got run a marketing campaign to get optimistic knowledge to come back to the profiles. Beforehand, establishments didn’t ship the complete file however solely shared destructive itemizing knowledge. The market is now shifting to understand optimistic knowledge which has helped in confronting the notion that the Kenyan borrower is excessive threat,” Metropol CEO Gideon Kipyakwai instructed Enterprise Day by day on Wednesday.
“Initially, folks used to know that CRBs had been those denying entry to loans. Right this moment, persons are realising that they’ll get a facility as a result of they’ve a CRB/credit score rating. The rating is their collateral and so they don’t want to supply a logbook.”
The Central Financial institution of Kenya (CBK) has supplied impetus for the sharing of optimistic credit score data by monetary establishments together with collaborations with CRBs to enhance credit score stories and credit score scoring fashions.
The implementation of risk-based credit score pricing has allowed completely different debtors to be appropriately priced for credit score, particularly for purchasers perceived as excessive threat comparable to micro, small and medium enterprises.
The 2020 Banking (Credit score Reference Bureau) Laws have additionally boosted the credit-sharing ecosystem.
Key reforms launched by the rules embrace the setting of a minimal threshold of Sh1,000 for destructive credit score data that’s submitted to CRBs by lenders whereas first-time CRB clearance certificates are free.
Improved credit score sharing has seen client credit score scores defy the bounce in non-performing loans amid high-interest charges.
Whereas the business’s ratio of non-performing loans has eased off to 14.8 p.c as of December from a excessive of 15.3 p.c in October, the dangerous loans have remained elevated whereas rates of interest on business financial institution lending charges have reached highs of as much as 26 p.c for the riskiest debtors.
The demand for credit score has, nevertheless, remained above double-digit charges supported largely by working capital necessities
