Safaricom and KCB Bank Kenya (KCB) have introduced an overdraft facility, ‘Fuliza ya Biashara,’ to enable business owners to access goods on credit.

Business owners can access a minimum overdraft of Kes1,000 and draw multiple overdrafts of up to Kes400,000 based on their assigned limit.

The overdraft is automatically repaid from incoming till payments, with amounts outstanding beyond 24 hours charged at a 2 per cent daily access fee for up to 29 days.

The Fuliza ya Biashara limit is reset every time a repayment is made, enabling business owners to immediately access new overdrafts, including the amount they just repaid.

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The facility 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.

Further, the facility will provide a 24-hour interest-free period on an overdraft of up to Kes400,000.

Safaricom CEO Peter Ndegwa noted that the firm launched Lipa Na M-PESA as a way for businesses to conveniently receive cashless payments through their mobile phones whenever they are.

 “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.”

Fuliza ya Biashara will be available through the M-PESA Business App and the Lipa Na M-PESA Transacting Till.

On his part, KCB Bank Kenya Managing Director Annastacia Kimtai said the proposition signifies the immense opportunities available within the digital ecosystem managed by KCB and Safaricom.

“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.