Personal Loans
October 22, 2024
EDITOR'S NOTE: This article is a part of our Money254 Partner Series and is produced in partnership with Timiza Kenya. For more on Money254’s editorial policy, read here.
Timiza is a mobile banking solution launched by Absa Bank Kenya in 2018 (then Barclays Bank Kenya). It is an all-in-one app that not only serves as a mobile loan app, but also enables users to save money and earn interest, pay utilities and buy insurance.
Timiza allows anyone who fits their eligibility criteria to access mobile loans of up to Ksh150,000 without needing to have an Absa Bank Account - making it one of the few loan apps offered by regulated commercial banks available to non-account holders.
This article takes a deep dive into the Timiza Digital Loan App, eligibility, interest rates, pros, and cons, use cases, and customer reviews to help you decide whether it is a good fit for your short-term borrowing needs.
You can borrow from a minimum of Ksh1,000 to a maximum of Ksh150,000 through the Timiza Digital Loan App. This makes Timiza the digital loan app with the highest loan limit among apps that are accessible to everyone regardless of being a bank account holder or not.
One of our team members tested out the app in the run-up to writing this article and was able to borrow Ksh1,700 on the first loan. After repaying this loan, they now are able to access a loan limit of Ksh46,000.
As mentioned earlier, even if you do not have an Absa Bank account, you can access a Timiza Digital Loan. But, you need to fulfill the following requirements.
Timiza is also accessible via USSD *848# meaning you don’t need a smartphone to apply for a Timiza Digital Loan
The Timiza Digital Loan is offered for a maximum tenure of 30 days.
To access the Timiza Digital Loan, it will cost you 7.25% of the loan amount for 30 days making it one of the cheapest short-term loans available to everyone without needing to have a bank account. The cost is as follows.
See the What We Like About Timiza section below to compare how the Timiza loan stacks up when compared with other well-established lenders in the market in terms of cost.
Once your application is approved and the loan is processed, the money will be deposited into your Absa Timiza Account. You can access it by transferring to your M-PESA account. Or directly sending it to another Timiza user.
Withdrawal from Timiza wallet to M-pesa is charged Ksh25 for amounts less than Ksh1,000, and Ksh32 for amounts higher than Ksh1,000.
Transferring money between Absa Timiza accounts is free of charge.
The M-PESA account that you can transfer your loan amount to should be the one registered under your Timiza Account
You can repay your Timiza Loan using M-PESA as follows:
You can also use the USSD *848# to repay your Timiza Digital Loan.
The Absa Timiza Digital Loan is offered for a maximum tenure of 30 days. If you fail to pay back your Timiza Loan within this period, you will be charged a ‘Roll-over fee’ of 5% of the outstanding loan amount, and the deadline will be extended for another 30 days.
This is in addition to the total interest accrued for the 30 days. As a part of a regulated commercial bank, Timiza is obligated to report to a Credit Reference Bureau.
Timiza offers loans from a minimum of Ksh1,000 up to a maximum of Ksh150,000.
It can be a great option for anyone requiring an instant cash injection of a large amount either for business reasons or during an emergency.
This means, you would be keen on increasing your loan limit to make sure when you are in need of this kind of money urgently, you can easily access it on your phone without filling out any paperwork or visiting a branch. Instantly.
Growing your Timiza loan limit to the maximum of Ksh150,000 includes the following
1. Increasing your Timiza activities such as
2. Increasing your activity on M-PESA and other Safaricom services including repaying Okoa Jahazi on time
3. Pay your previous Timiza loan on time. Early repayment is considered beneficial.
4. Maintaining positive CRB standing
At 7.25% per 30-day loan, the Timiza Digital Loan is one of the cheapest short-term loans available in Kenya.
It is marginally cheaper when compared to other mainstream digital loan alternatives such as M-Shwari (9% per loan), KCB-MPESA (8.75%), and M-Coop Cash (8% per loan) save for KCB Mobile (7.02% per loan) but to qualify for KCB Mobile you need to have had an active KCB account for 6 months. This technically leaves Timiza in a standout category of its own.
For comparison, the Hikash digital app charges 18.5% per 14-day loan, Tala charges between 7% and 19% per 30-day loan, Zenka (9%-39% for a 61-day loan%), and Branch Microfinance (17.6% for a 30-day loan)
Of the digital loans so far reviewed by Mone254, the Timiza Digital Loan stands out with its high limit of up to Ksh150,000. While other mobile loans associated with banks do offer comparable amounts, they are restricted to account holders only - unlike Timiza.
When compared to digital loan apps not associated with commercial banks or MFIs, Timiza stands out by offering almost three times the highest loan limits. Average maximum loan limit for such apps is at about Ksh30,000 - Ksh50,000.
Despite being owned by Absa Bank Kenya, a CBK-regulated commercial bank, the Timiza Digital Loan is open for application by everyone regardless of whether they have an Absa Bank account or not.
You need not have banked or saved with Absa Bank Kenya previously to qualify for a Timiza loan. This is unlike mobile loans offered by comparable commercial banks that have some form of requirement to be a bank account holder to be eligible.
This makes Timiza a true competitor to digital lenders offering short-term loans of up to 30 days such as Zenka, Tala, and Branch.
With the digital loan space rife with accusations of predatory lending, unethical collection practices, and exorbitant interest rates, borrowers considering the Timiza Digital Loan may find the fact that the app loan is a product of a licensed and regulated commercial bank to be reassuring.
For the customer wary of debt shaming practices and data misuse associated with a rogue section of digital lenders, Timiza may be the product of choice.
It is important to note that there are many legitimate digital lenders operating in Kenya, some already licensed by the CBK and others are in the process of getting their licence applications reviewed.
If you are urgently in need of some cash, the Timiza Digital Loan App promises almost “instant” disbursement provided one meets all the eligibility requirements outlined above. Our colleague who tested out the Timiza app, as we mentioned above, received the approved funds in under two minutes.
As mentioned earlier, the Timiza Digital Loan App comes packed with several services in addition to the ability to borrow an instant loan. The services include
To sign up for the Timiza Digital Loan App, you only need to provide your National Identification (ID) card number and a mobile number registered with M-PESA.
You are not required to upload any pictures of your ID, no contact details of your employer, guarantor/contact person, or pictures/selfies of your face.
Once you qualify for the Timiza Digital Loan, it is not disbursed to your M-PESA account. It is instead deposited to your Timiza Account from where you can transact.
To withdraw from your Timiza account to M-PESA, Timiza charges a withdrawal fee of Ksh25 for amounts below Ksh1,000 and Ksh35 withdrawal fee for amounts above Ksh1,000.
This means, if you intend to withdraw your loan amount at an M-PESA agent, you would need to pay the withdrawal to M-PESA fee and also an M-PESA withdrawal fee at the agent.
This is as compared to zero withdrawal fees for non-bank digital loans that disburse directly to your M-PESA account. Here you would only need to pay the withdrawal fee at the M-Pesa agent only.
Timiza, however, does offer users the option of sending money directly to other Timiza account holders free of charge.
You may compare this withdrawal fee to the overall cost of the loan as compared to the overall cost of borrowing from another digital loan app that disburses directly to M-PESA to decide if this is a deal-breaker for you.
Remember our team member who borrowed Ksh1,700 and got their loan limit increased to Ksh46,000 after repaying? Well, even after repaying way before the 30 days, she still had to pay the full interest for 30 days.
The Timiza Digital Loan has a tenure of 30 days at a cost of 7.25% for the duration. As it stands currently, you will pay the same amount whether you pay on day 1 of the loan or on day 30.
From our review of short-term loans digital loans available in Kenya today, the lack of early repayment discounts/incentives seems to be standard across the board. So there may be generally no advantage in choosing a competing lender unless they offer an early repayment discount which, as we have said, seems to be standard across all digital loan providers.
However, early repayment generally counts as a factor in helping one increase their loan limit. It is always advisable to pay sooner than later.
One of the things we like about the Timiza Digital Loan App is the fact that you can pay your utility bills straight through the app. If for example you took a Ksh2,000 loan and used Ksh800 of it to pay your KPLC power bill, you can clear it straight through the app without needing to move it to M-PESA.
However, the app charges Ksh60 for bill payments which is a slightly higher amount as compared to transferring it to M-PESA (Ksh25) and using the KPLC Paybill (Ksh23).
One of the great things about Timiza is you can apply via the Timiza Digital Loan App or USSD.
We’ve broken out both examples below.
To apply for the Timiza Digital Loan using the mobile app, follow these steps.
If you do not have a smartphone, or cannot use the Timiza Digital Loan App for whatever reason, you can simply use the USSD service. Note that to use this service, you need to have airtime on your line. Also, make sure you have first registered for a Timiza account.
Follow these steps to apply for a Timiza Loan via USSD.
The Timiza Digital Loan App has a 3.7-star out of 5 stars rating from over 4,780 reviewers. It has been downloaded over 1 million times on the Google Play Store.
Here is how Timiza's star rating compares to popular digital lenders.
Here is how Timiza’s star rating compares to bank-based loan apps.
NOTE: The above is as retrieved from the Google Play Store on Tuesday, February 28, 2023.
“One of the best loan apps in Kenya. Sincere, fast, with reasonable interest rates.”
“Excellent app. Low interest rate, and you won't be bothered by flooding SMS and frequent calls as reminders like other apps do.”
“It's a good app. Although there are a few hiccups, your interest rates are not bad but kindly grow the rate faster and vary the period of repayment. Thanks for now! Kudos.”
“The more I continue using the app the more I feel inspired due to your efficient services n loaning. Even when I delay to pay loan on time, you have been so kind. Keep up the spirit. I give my five bright stars.”
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