How To Leverage M-Shwari To Achieve Your Financial Goals In The Midst Of The Pandemic

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Let’s do a small exercise. Try and imagine this scenario. It’s January 2020, you just landed a job at a restaurant as a waiter. It’s a small restaurant that’s currently trying to get more leads and increase sales. You have four co-workers. Then, March comes, and the worst happens. The first case of COVID-19 is announced. A few days later, life teaches you that rock bottom has a basement. The government orders closure of all restaurants and yours is no exception.

Your boss, a kind-hearted lady, has no choice but to send you home. You enter the matatu in dismay that afternoon, wondering how you’ll raise your rent which is due in two weeks. But aha! The epiphany comes that you can borrow a loan from M-Shwari. This should at least take you through a few weeks as the boss organizes how to set up her online business, then perhaps, she’ll require your services again.

This is the reality for many Kenyans, even a year after the first case was announced. An article on The East African found that by June 2020, at least one million Kenyans had lost their jobs or been put on indefinite unpaid leave as the Covid-19 pandemic morphed into a major jobs crisis. The pandemic has clearly had a toll on people, not only mentally and emotionally but also financially. Thanks to mobile lending platforms such as M-Shwari, however, Kenyans who don’t have formal bank accounts, or whose incomes are not stable enough to borrow from formal financial institutions, have benefitted immensely from this great NCBA and Safaricom innovation.

Lucas Ogada, a matatu conductor on the Makadara route, earns approximately 200 bob daily. However, due to the nature of his work, his income fluctuates. This made him take loans from M-Shwari. Through the platform, he has been able to offset some of his expenses thereby allowing him time to make some more income and plan himself financially.

But that’s not an isolated story of how M-Shwari has helped Kenyans. Everlyn Mumo, a micro-entrepreneur supports three kids by buying weaves that she sews into wigs. She uses M-Shwari to build capital by taking loans and pays them back as soon as she sells the final products.


M-Shwari is important, not only in today’s context but even in the times to come. It has been a game-changer in the industry and today provides financial services to over 35 million Kenyans. The platform has provided a tool to manage daily cash flows, therefore, empowering Kenyans financially and deepening financial inclusion in Kenya. M-Shwari is originally Kenyan but has navigated its way through five other African markets.

The benefits of M-Shwari are invaluable. If it isn’t the most obvious, M-Shwari is a convenient digital finance service. You don’t need to queue in lines to access your money, and there is no fee to set up an account.

Secondly, it is extremely beneficial for taking loans. In other banks, interest is calculated daily but paid out annually while M-Shwari interest is paid out quarterly. M-Shwari enables you to access micro-credit product (loan) of a minimum of KSHs.2,000 any time and receive your loan instantly on your M-PESA account.

Taking loans with M-Shwari has an added advantage in that, in case the debtor is unable to pay the loans off, the customer relationship with Safaricom and with M-PESA remains undisturbed. Safaricom does not transfer your M-PESA money to service the loan without your consent.

If the loan is not repaid by day 31, it is automatically renewed for an additional 30 days, and the customer receives a text letting them know that if the loan is not repaid, it will be reported to the credit bureau as required by law. If the loan remains unpaid, a second reminder is sent on day 60, a third and final reminder is sent on day 90, and the loan is reported on day 120. The late repayment will remain on the credit bureau for five years, but once the balance is cleared, the status will change to paid.

You may not always be able to pay off your loans, and sometimes for a valid reason. However, it is important to highlight the importance of responsible borrowing. We are in tough economic times that have arisen due to the unprecedented circumstances of the pandemic. We need to learn how to borrow without going in blindly and setting ourselves up. Borrowing responsibly will help you both today and in the years to come. This entails repayment and positive customer credit behaviour. Pay your loans on time so that you’re deemed credit-worthy, and so that M-Shwari can sort you out whenever you need it. You can focus your cash flow on repaying the loan. Try and pay the loan partially within the month to ease the burden. Most importantly, make sure to review your credit history very often so that you don’t get caught unawares.

Now let’s talk about savings. There’s a popular saying that goes, don’t save what is left after spending, spend what is left after saving. If anything, COVID-19 has taught us to always prepare for a rainy day. Things could change in an instant. One day you have a stable income and the next you have none.

With M-Shwari, you get to save as little as KSHs.1 and earn interest of up to 6% p.a on your Lock saving account balance. The funds saved in the account will be kept there until the maturity date which is determined by the customer and ranges between one and six months. Customers can make micro-deposits into this.

What are some of the good saving habits that you need to muster? Well, for starters, create a budget and keep an eye on your spending. Know what you are saving for. It is necessary to save funds for an emergency, personal development, leisure activities, education, and investments. Don’t know where to start? We got you. Check out this article – Finances 101: How To Create A Budget And Different Budgeting Methods You Can Use

You might want to consider the 50-30-20 budget rule, where 50% is allocated to “needs,” 30% to “wants,” and 20% to your financial goals. M-Shwari can help you to lock the 20% so as to achieve your financial goals, and while you save money, you earn more from the saving. What’s a better deal than that?

On her Youtube Channel, Money Box by Rookie Manager, she encourages people to use M-Shwari for the 52 week challenge seeing as it is a very quick process. All you need to do is tap a few buttons and your money is instantly locked. Again, you are less likely to impulse buy because you can only withdraw money after twenty-four hours of requesting to do so. Lastly, M-Shwari is a secure form of saving.

Once you have achieved your goals in terms of savings with M-Shwari, you can consider investing this money in other areas, such as bonds, money market funds, SACCOs, or even business investments. You can also use M-Shwari to save for fun things – like a holiday. Saving for that dream holiday vacation

Even in the midst of these uncertain times, NCBA and Safaricom have taught us, through M-Shwari, that together we can achieve more. What’s important is to leverage the platform such that it sorts you out and helps you to make more money. Hopefully, soon enough, we will see a silver lining out of the cloud that is COVID-19.

To open up an M-shwari account, all you need to do is go to your M-PESA menu, select “My account” and “Update menu” then go to your M-PESA menu, select Loans and Savings, M-Shwari, click on activate the account and accept terms and conditions.

There is so much you can do with your M-Shwari savings. Think big and start saving today. Also, check out

Saving With Mshwari: Do You Know The Benefits?

M-shwari 52 week challenge: Ideas on what you can do with the savings 

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