M-Shwari, launched in November 2012, it is already receiving much attention for its mobile phone based credit scoring system, and robust growth rate. MicroSave, with inputs from Grameen App Labs, conducted market research to assess customers’ perceptions of and reactions to M-Shwari. From the research, it seems that the savings feature is used by a more upmarket demographic to circumvent the limits on saving on M-PESA; while the small loan facility is accessed by lower income customers. Of all the clients interviewed, only one had been approved for a loan larger than KES 2,500 (US$ 28.74), while all wanted larger amounts, and Safaricom reports the average loan size at around KES 1,000 (US$ 11.49). There is also widespread confusion about the basis on which credit limits are decided by the system. As a result, a great deal of the much-vaunted KES 2.8 billion (US$ 32.2 million) deposited in the first three months may have been as a result of customer depositing and withdrawing to test the system and credit appraisal algorithm. Customers also have a series of specific recommendations to improve the M-Shwari product and these are also outlined in the Note.

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