Microlender Jijenge Credit has increased its security margins to avoid sinking into insolvency amid growing quick loan requests on resumption of business following the easing of coronavirus lockdowns.
The lender has witnessed increased loan requests from micro, small and medium-sized enterprises (MSMEs) who make up most of its customers since July 6 when President Uhuru Kenyatta eased the restrictions.
Jijenge Credit chief executive Peter Macharia said the lender has had to vary its security margins to accommodate more customers while staying afloat.
“Instead of doing 50 percent, we are now doing 30 percent, meaning that if initially we lent to 50 percent value of a car, we’ve reduced that to a lower percentage,” he said.
By widening the margin between the amount of the loan and the value of the security, the lenders are able to lend to more customers.