A section of Kenyan mobile subscribers has a reason to smile after the leading telco in the country Safaricom announced its intended move to remove about 4 million of its subscribers negatively listed in the Credit Reference Bureau (CRB).

Safaricom’s CEO Peter Ndegwa on Tuesday during an interview with a local TV station said his company is working in conjunction with the Kenya Commercial Bank (KCB) and NCBA to make implement the decision which is aimed at getting more revenue and customers.

According to Ndegwa, once the move is effected, subscribers will be free to access fresh loans from various lending products they offer.

“Today we have reduced Fuliza costs by 50 per cent on average. We are also working with NCBA and KCB as our banking partners, and they are going to be repairing four million customers that were previously listed on the CRB,” Ndegwa said.

“We will be taking them off the listing in the CRB so that they are able to access new loans; it will be 4 million additional new customers who will be free to access Fuliza and other lending products out there…the repair will happen from November.”

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While noting that the move may cost them in losses, Ndegwa said the removal of customers from CRB allows them to borrow once again from their loan facilities, which will enable the companies to recover their lost revenue.

“Yes, Safaricom and banks will lose a lot of money, and a reduction in the revenue that we earn. Since we reduced the cost, we have seen an increase in numbers using Fuliza, more frequency of customers using Fuliza and higher amounts using Fuliza,” he said.

“We expect over time the revenue will be recovered through the additional usage by customers. We believe that if the product is more sustainable and affordable, it will be better for the future of this product and its customers.”

The CEO also explained why they cut the Fuliza loans stating that Safaricom was focused on increasing the customer base,00 that will increase the revenue, which is their long-term goal.

He also said they responded to complaints of the level of Fuliza cost and usage advising that if the load is used for a few days it may not attract more interest as opposed to extending the loan period.

“Fuliza is used by 7 out of 10 if not more of our customer base across the country; certainly anyone you see on the streets would have used Fuliza at one point or the other,” Ndegwa said.

“We were cautious that there were complaints about the level of cost of Fuliza and also how Fuliza is used; sometimes people extend Fuliza. It is supposed to be used as an emergency credit for a few days. If used for a few days, it is fairly affordable.”

He emphasised Fuliza is one of the most affordable overdraft facilities but if it is paid within 4 or 5 days.