NEW PRODUCT

Mwananchi Credit unveils loans for rental house owners

The low earnings by tenants is is attributed to reduced disposable income

In Summary
  • The facility to cover unpaid rent by tenants whose earnings have been cut short by Covid-19.
  • The loan will be secured by the rental income that the property collateral gets on a monthly basis.
Rental houses in Nairobi
Rental houses in Nairobi
Image: FILE

Mwananchi Credit Limited has introduced a new product line: Rental Income Loans to help house owners cover unpaid rent by tenants whose earnings have been cut short by Covid-19.

Cytonn Investment has projected that the country's real estate sector will drop this year with both residential and commercial offices expected to record negative performance.

This is attributed to reduced disposable income among consumers and oversupply in select sectors which include; the middle - high-end residential, the commercial office and retail sectors.

A survey conducted last year by the Kenya National Bureau of Statistics (KNBS) revealed that nearly 70 per cent of households are struggling to pay rent.

In a statement, the credit firm said the loan will be secured by the rental income that the property collateral gets on a monthly basis.

''A landlord or lady just needs to present a title deed and a sign Rental Agency Assignment Deed. This removes unnecessary encumbrances that complicate the process,’’ the microlender said.

Mwananchi Credit chief executive officer Dennis Mombo said the new product will open a faster financing line to property owners, which is a big win for financial access.

“At Mwananchi Credit, our key focus is providing emergency financing with the greatest level of convenience to the customer. We believe that time is money and all our innovations are structured towards bridging the time gap between client demand for capital and their actual access,’’ Mombo said.

This move comes as the government, through the Ministry of Lands has been rolling out the land digitisation records through the Ardhisasa portal and is viewed as a shot of confidence in the government’s efforts to democratise and create transparency in the land processing efforts.

Mwananchi Loans lending model utilises an innovative future-earning capacity credit score that qualifies applicants based on their future plans and ability to repay rather than their past financial history.

Their main loan product lines include logbook lending, car asset financing and title deed loans.