Equity Bank has introduced Boostika, an overdraft loan solution that will rival Safaricom’s Fuliza. The loan solution allows Equity Bank customers to overdraw their accounts when buying airtime or paying for goods and services using the mobile app, USSD code, or Equitel. With the Boostika prompt, customers can complete transactions without terminating the payment process.
Key Features
The loan facility gives customers an unsecured overdraft of Kshs 100 – Kshs. 100,000. Customers can only borrow an amount within their loan limit. Boostika loan is payable after one month. According to Equity Bank, the loan can be repaid through an auto sweep from the customer’s account or using channels used to acquire the loan.
Boostika attracts an annual interest rate of 18%, which equates to 1.5% per month. In addition to the interest rate, borrowers will be charged a processing fee (5%), insurance (1%), and an exercise duty at 20% of the processing fee.
Who Qualifies?
Boostika is only accessible to Equity customers with an active bank account for a period of over six months. Also, the lone is only available when one is making a payment or sending money using the Equity Mobile App, *247#, or Equitel. Customers must have a loan limit and a good repayment history to qualify for Boostika.
Boostika is a great addition to the Equity’s existing services. The revolutionary overdraft facility came as Equity Bank saw massive growth in digital transactions. Recently, the Pay With Equity platform recorded a 243% growth in transaction volume from 14.1 million transactions to 48.3 million transactions.
How Boostika Compares to Fuliza
Without a doubt, Equity Bank’s introduction of Boostika brings competition to Fuliza. The two services serve a similar purpose. However, there are notable differences between Boostika and Fuliza as follows.
Maximum loan limit: Boostika’s maximum loan limit is Ksh 100,000. Fuliza offers a maximum loan limit of Ksh 70,0000.
Charges: Boostika loan attracts an interest rate of 18% pa, 1% insurance, 5% processing fee (5%),), and 20% an exercise duty on the processing fee. Charges for Fuliza customers include a 1% access fee, 20% exercise duty on the access fee, and a daily maintenance fee.
Withdrawal: Boostika funds are only accessible when completing transactions. Fuliza allows customers to withdraw funds from M-Pesa agents.
Final Thoughts
In an era when financial empowerment is crucial for economic growth, products like Boostika emerge as an innovation with a huge potential to address the financial needs of many Kenyans. This overdraft facility allows eligible customers to conveniently complete transactions anytime, anywhere. Let’s wait to see how Safaricom will respond to Equity’s move.
