I recently came across the news that Tala– the mobile lending app operating in Kenya, Tanzania and the Philippines, has secured Ksh.6.5 billion investment to expand its services to Mexico and India. Tala has so far-through the app, disbursed over Ksh28 billion in loans, using data from mobile devices to create a credit score for customers who might not have previously had a credit history.
Seeking to understand how the app works, how loans are disbursed, the speed, ease of use, payment period offered etc. I downloaded the app from the Google Play Store (it has a 4.7 rating out of 5) and documented my experience.
From the description section, the app claims that a loan application will take 5 minutes, be approved in seconds and cash sent directly to M-Pesa. Tala discloses right from the Play Store that it will scan my M-Pesa SMS and other information to determine my credit worthiness and that it won’t be shared without my direct permission.
Additionally, the app asked to access my location, device/app history, contacts, call logs, caller information and the phone camera, I accepted and installed the app- it takes up more space (7.04 MB) on the phone than competitor Branch. I then had to choose a language with an option of using Swahili or English, I chose the latter and was immediately prompted to enter my M-Pesa number – where a confirmation code would be sent to verify that the number belongs to me (this feature prevents someone from taking a loan under another person’s number).
The next step is setting up a 4-digit security pin which I quickly went through while giving the app permission to manage my phone calls (this is to secure my phone and the app claims that it won’t make or receive calls from my device). The registration process is short and I’m ready for a loan in less than five minutes.
Tala requires first-time loan applicants to verify their identity by filling in their information on a form in five steps provided on the app. I am prompted to fill my personal details (name, date of birth, email etc.) and the first step is done. The app proceeds to ask for permission to access contacts, messages and location to establish what my network is like-who I relate to etc. you can’t get a loan without giving the permission. Tala then asks for information in regards to my education level, employment, what I’d like to use the loan for (you have to describe this in detail) and whether I have any outstanding loans.
I advance to the fourth step, where I have to disclose my income; my main source of income, side hustle, how long I’ve been doing it, the amounts earned etc.
As the last huddle, I am allowed to confirm all my previous answers before submitting as I await my fate. After review, my application is not approved for a loan (unfortunately), however, anyone who fails to get approval for a loan is legible to apply again after 30 days.
On further research, I learnt that for those whose applications get disapproved, if you leave the app installed on your phone for some time it increases your chances of getting a loan as the app keeps monitoring your phone and information based on your phone activity while building a credit rating for you.
- I liked that the app is small in size and lightweight (not bloated) which makes it load fast especially if you’re internet connection is strong.
- Tala also makes an effort to tell you right from the app store, that it’s going to access your phone data. Additionally, throughout the application process, the app keeps on asking for permission first before accessing your information.
- I liked that the app has a Frequently Asked Questions (FAQ) section that is very easy to spot and written in simple language.
- I liked that you can also contact support staff straight from the app.
- The app offers a referral promotion where you earn a bonus of Ksh.100 whenever anyone you refer to the app repays their loan.
- I found the loan application process painfully long, with too many questions for my liking.
In the whole application process, I get a sense that from the questions asked, the app tries to establish whether applicants have a consistent source of income for paying back the loan and whether the information they give is true. Hence have it in mind to frame your answers appropriately to establish credibility but do so accurately. Have applied for a loan on Tala, how was your experience?
In a past interview with Socal Tech, Tala CEO Shivani Siroya said that the app looks at capacity, affordability and behaviour as the criteria for lending. She added that Tala determines whether to give you a loan by looking at details including transactions, savings data, account balances receipts for utility bills paid or unpaid. In other words, what this means is that if you ignore an unpaid-bills message from your water/power/insurance company lingering in your phone for too long, it could cost you a loan when you need it.
Speaking of mobile loans here is a Review Of Branch Mobile Application