How Much Interest Does M-Shwari Charge Per Month?

Quick answer: M-Shwari does not charge a monthly interest rate in the usual sense. It charges a one-off facility fee of 9% on the amount you borrow, made up of a 7.5% loan fee and 1.5% excise duty, for a 30-day loan term. So borrowing KES 1,000 costs about KES 90 in fees. If you do not repay within 30 days, the loan rolls over for another 30 days and the fee is charged again on the amount outstanding.

What M-Shwari is

M-Shwari is a savings and loan service on M-Pesa, run by Safaricom with NCBA as the lender. You can save from as little as KES 1 and, once you qualify, borrow from KES 1,000 up to KES 1 million. Your loan limit is built from your M-Pesa and M-Shwari activity over time, and you reach it through the M-Pesa menu on *334#.

How the loan fee works

Instead of a daily or monthly interest percentage, M-Shwari applies a single facility fee when you take the loan. That fee is 9% of the amount borrowed: a 7.5% loan fee plus 1.5% excise duty, with the excise deducted from the amount sent to your M-Pesa. The loan runs for 30 days. Borrow KES 5,000 and the fee is about KES 450; borrow KES 10,000 and it is about KES 900. Because it is a flat fee rather than interest that builds daily, repaying early does not reduce the fee, but it does keep you clear of a rollover.

What happens if you do not repay in 30 days

If the loan is not cleared within the 30-day term, it is rolled over for a further 30 days and the facility fee is charged again on the amount still outstanding. That is what makes carrying an M-Shwari loan for months expensive, and why it is worth clearing it within the first term where you can. A persistent default is also reported to the credit bureaus, which our guide on clearing your name from CRB covers.

The savings side

M-Shwari is also a savings account. Money you save earns interest of up to 6.3% per year, paid on your balance, and you can lock funds for a fixed period to save towards a goal. The two sides work together: a healthy saving and repayment history is what grows your borrowing limit.

How it compares

For a single 30-day loan, M-Shwari's flat 9% fee is easy to budget for. Whether it beats the alternatives depends on how long you borrow: a short Fuliza overdraft can be cheaper for a few days, while other apps differ again. We weigh them up in our comparison of KCB M-Pesa and M-Shwari.

Frequently asked questions

How much interest does M-Shwari charge per month?

M-Shwari charges a one-off facility fee of 9% on the amount borrowed (7.5% loan fee plus 1.5% excise duty) for a 30-day loan, not a recurring monthly interest rate. A KES 1,000 loan costs about KES 90.

What does a KES 5,000 M-Shwari loan cost?

About KES 450 in fees for the 30-day term (9% of KES 5,000). If you do not repay within 30 days, the fee is charged again on the rollover.

Does repaying M-Shwari early save money?

The 9% fee is fixed when you take the loan, so early repayment does not reduce it. What it does is avoid a rollover and protect your credit record and your limit.

How much can I borrow on M-Shwari?

From KES 1,000 up to KES 1 million, depending on your limit, which is built from your M-Pesa and M-Shwari history.