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Zenka: Inside the First Digital Lender in Kenya to Forgive Defaulters 
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Zenka: Inside the First Digital Lender in Kenya to Forgive Defaulters 

EDITOR'S NOTE: This article is a part of our Money254 Partner Series and is produced in partnership with Zenka Digital Kenya. For more on Money254’s editorial policy, read here.  

Late last year Zenka forgave Ksh166m of penalty fees. We sat down to ask them all about it.

The year 2022 was a tough one for many resilient Kenyans. Inflation hit a five-year high in October breaching the 9.6% mark in a year where a 2kg packet of maize flour cost more than Ksh200 and a litre of petrol reached a record Ksh180 even as job losses continued to be registered. 

With January 2023 inflation still high at 9.0%, it is no wonder that many Kenyans have been struggling to repay the loans that they had turned to at their time of need, given the economy is still recovering from Covid-19-induced shocks. 

In its latest country economic update released December 8, 2022, the World Bank indicates that a majority of Kenyans (60%) were kept going by some form of credit in 2022, either loans, relying on friends and family, or purchasing essentials on credit. As many as 12% of Kenyans, the World Bank survey shows, had to resort to taking loans to purchase food.  

It thus came as a huge relief for Zenka Digital customers on November 21, 2022, when the digital lender announced it was forgiving a total of Ksh166 million in penalty fees for defaulters. 

With digital lenders over the last few years having racked up a bad rap with accusations of lacking customer-centric policies, Zenka’s latest gesture brings into focus the efforts by players in the digital lending market to change this narrative. 

Zenka, a founding member of the Digital Lenders Association of Kenya (DLAK) - now DFSA-K, has quickly established itself as a leader in the digital lending space in Kenya with over five million downloads. 

Launched in 2018, Zenka is the first digital lender to publicly forgive nearly Ksh200M of penalty fees on defaulters. 

In a market shrouded by controversy, we sat down with Zenka Country Manager Duncun Motanya to understand more about this move, what it means for the users and how Zenka differentiates itself in a crowded market. 

Two months ago in November 2022, Zenka forgave Ksh166m in default penalty fees, who did this apply to and what was the motivation behind it? 

The partial write-off of defaulted loans was addressed to those borrowers whose loans were non-performing and whose lives were severely impacted by the adverse effects of the pandemic. 

The extremely challenging post-COVID period, resulting in massive loss of employment and closure of micro-enterprises, required a high level of responsiveness and flexibility on the industry's side. 

Therefore, we have thoroughly analysed the market situation and decided to act preemptively to contribute to the country's economic recovery. 

As a socially responsible lender, co-founder, and member of the Digital Lenders Association of Kenya (DLAK) - now DFSA-K, Zenka challenged the industry and led by example to significantly reduce the defaulters' financial burden, thus facilitating taking steps toward regaining their financial balance.

This is particularly impressive given the consistent stories in the market about the bad collection practices of digital lenders in Kenya. How would you define Zenka’s approach to collections and how is it different?  

At Zenka, we believe that preventing a fire is smarter than calling firefighters. That's why we go to great lengths to support our customers throughout the lending cycle, not only when they borrow money – by fairly assessing them at the loan application stage – but particularly when they are repaying it.

We kindly remind them that the due date is approaching, and if they're going through a difficult time, we offer them a grace period or convenient extension options.

Without a doubt, complying with proper lending standards is highly desired when lending money but is even more significant when collecting debts.

Since its very first day in the Kenyan market, Zenka has been promoting responsible lending based on the highest and most rigorous international standards.

One of the most significant strides toward regulating the lending market in Kenya was the initiative to establish the Digital Lenders Association of Kenya (DLAK) - a collective body dedicated to ensuring a strong future for the digital lending industry built on best practices in lending and consumer protection - now rebranded to DFSA-K.

Meticulous creditworthiness assessment combined with smart financial products and flexible repayment options have enabled Zenka to win the hearts of Kenyans.

Bearing in mind that even the most deliberate customer may face unpredicted difficulties, we encourage borrowers going through a tough time financially to contact Zenka's customer service to find a solution that will satisfy both parties.

Instead of choosing the escalation path, widely practised by other lenders, Zenka promotes a win-win strategy. We focus on solving issues in close cooperation with the customer.

Such a customer-oriented case-by-case approach distinguishes Zenka from companies exploiting vulnerable borrowers and applying humiliating and threatening debt-collecting practices.

Helping quickly in an emergency while treating customers with respect, dignity, and understanding at every turn is the most cost-effective and least stressful way for both sides. 

Lately, users have been reporting cases of apps with almost similar-sounding names to existing lenders popping up on the Play Store. Is this an industry concern? How are you as Zenka and DFSA-K member approaching it?

As a responsible digital lender, certified by the Credit Information Sharing Association of Kenya and providing services for more than 5 million registered customers, the company condemns illegal practices adopted by fraudsters and takes measures to increase the safety of its customers.

The proliferation of fake lending apps with similar-sounding or purposely misspelt names aiming at confusing customers requires attention and decisive action. Therefore, Zenka strongly reacts to the surge of fake lending apps by reporting them immediately to Google Play Store.

The widely spread informative campaign on Zenka's social media profiles effectively complements the above-mentioned measures, increasing customers' awareness and encouraging them to take extra precautions when choosing a lending partner.

Some of the warning signs that you may be dealing with a fake lending app include being required to pay a “registration” fee or a ‘refundable’ borrowing fee, fake or non-existent telephone numbers and websites, no registered physical addresses and lack of customer support channels.

Every signal coming from our customers is analysed and taken care of.

For the sake of the lending industry, a similar approach has been adopted by other renowned lenders.

There has been increasing user concern in general lately around data privacy and new regulation that has led many to question why they should repay their loans at all. As Zenka, what would you say to such a borrower?

There is no doubt that repaying loans on time brings long-term benefits. Not only does it push up your credit limit, it also makes you appear to be more reliable to lenders in general.

Defaulting on loans is risky and may get customers in serious trouble. Loan defaulters are deemed unreliable and, in the aftermath, are unlikely to receive loans from legitimate market players.

Therefore, we strongly recommend repaying on time and contacting the lender if you are going through a difficult financial phase.

Legitimate companies following proper lending standards will support their customers at their time of need and devise a satisfactory solution for both parties. This is why regulation is a must.

Its main goal is enhancing borrowers' confidentiality and strengthening their protection from threats, violence, and other abusive practices widespread in debt collection. What's crucial is that digital lenders will not be entitled to share any customer information with third parties (including reference bureaus) without a borrower’s explicit consent.

As one of the longest-running lending apps, a co-founder and member of the Digital Lenders Association of Kenya (DLAK) -now DFSA-K, Zenka has strongly supported the implementation and complied with the highest ethical standards in the industry since the very beginning of its operations in Kenya.

Due to the rapidly increasing number of mobile lending apps in the country (with an emphasis on fake ones), the call for regulation has become even more urgent.

Therefore, Zenka was among the first lenders to submit all required documents to aid the CBK's licensing review process. Yet, the Central Bank of Kenya has a statutory deadline of six months to make a decision, and dealing with 381 applicants requires time and patience.

The first 22 licences have already been granted; others (including Zenka's) are under review. The company runs business as usual while waiting to obtain formal confirmation.

The crucial effect of the CBK licensing process is the fact that lenders that missed the application deadline (or purposely didn't submit it) act unlawfully and are no longer entitled to maintain their operations in Kenya.

For this reason, customers are encouraged to take extra precautions when choosing a lending partner, including meticulously analysing any overly-attractive offers and being suspicious of suggestions to pay a deposit before applying for a loan (which is not a market practice!).  

Another issue we see raised by users looking for digital loans is around the difficulties of accessing higher loan limits. What tips would you have for a customer in order for them to access the full Zenka loan limit?  

Promoting responsible lending based on the highest and most rigorous international standards, thus empowering customers in their journey toward financial inclusion, is in the company's DNA. Therefore, our creditworthiness assessment is meticulous and based on various input data, covering broadly-understood customer risk.

We aim to support and motivate customers to work harder, think smarter, and convert the loan into their personal or business development. Yet, this can be achieved assuming bilateral cooperation between the lender and the borrower.

Building credit records takes time and requires financial discipline.

However, a lot of effort still needs to be put in by the industry to educate customers and promote a responsible approach to finance.

At Zenka, we explicitly promote responsibility and discipline regarding loan management.

Therefore, the most effective way to increase the loan limit at Zenka is to keep a clear repayment record (not only at Zenka but also at other lenders), i.e., repaying on time, avoiding defaulting, but, first and foremost - genuinely assessing your repayment capabilities.

The above facilitates increasing the personal loan limit, up to Ksh42,000. 

What are some of the things you are most proud of during your time at Zenka to date?

Zenka has been operating in Kenya since 2018, steadily gaining precious customer trust and prestigious industry awards.

Due to its customer-focused approach and highest business standards, the company has effortlessly convinced over 5 million Kenyans to try and stick to its services. Our loyal customers are the company's most significant source of pride and hard evidence that it is going in the right direction.

By offering our customers fast and easy access to financial services, we actively participate in eradicating social differences and creating more business opportunities.

We're proud to be a trusted partner empowering Kenyans to pursue their dreams and stimulating the development of their local businesses, thus contributing to the whole country's recovery.

Zenka: List of Awards 

Numerous prestigious industry awards confirm our belief that our effort pays off.

Independent committees have honoured Zenka with Most Promising Mobile Loans Platform in 2019 (Digital Tech Excellence Awards Gala 2019), Runner-up: Fastest growing mobile app in 2019 (Financial Inclusion Awards 2019), Most preferred non-banking loan platform in 2019 (Financial Inclusion Awards 2019), Most Preferred Mobile Loan App in 2020 (Digital Tech Excellence Awards), Outstanding Mobile Loans App of the Year 2020 Award (Pacesetters Awards 2020), Silver Winner: Mobile App of the year (2021) - Loan App, Silver Winner: Mobile App of the year (2021) - Social Impact, and Mobile App of the year (2021) in the Interface Design and User Experience category, to name but a few.

Quick-fire Questions From Money254 Readers

1. If I default on my loan and repay it later, will I be able to access another loan? If yes, will my limit be reduced and what can I do to grow it again if so?

Zenka's in-house algorithms calculate and grant the loan limit on an ongoing basis at the exact moment of applying for a loan.

Late repayment may or may not affect your credit limit since it's not the sole element taken into evaluation. The algorithms analyse many data points to assess risk as accurately as possible.

Timely repayment is the easiest way to increase your credit limit (it applies to all taken loans, not only at Zenka).

2. I am on my second Zenka loan but have read reviews on the Play Store that say many users don’t qualify for their third loan. Why is this so and is it something I should be worried about?

The company follows the highest international lending standards built on best practices in lending and borrowers' protection. We care for our customers; therefore, if there's no risk of over-crediting, our algorithms allow for applying for another loan.

However, if the risk has increased, for the sake of our customers' financial stability, we ask them to return once they settle their other commitments. As soon as they repay the outstanding loans from other lenders, they are welcome back at Zenka.

3. I’ve realised I won’t be able to pay my loan on my due date in advance. Is there anything I can do to notify Zenka? 

When facing unpredicted difficulties, we encourage borrowers to contact Zenka's friendly customer service to find a satisfactory solution for both parties.

To help our customers struggling to repay on time, we have introduced a 3-day grace period. No interest is charged during the first three days past the due day. The grace period is provided to all Zenka's customers with no exemptions or additional costs.

If more time is needed to repay the loan, Zenka offers loan extensions enabling you to postpone your due date by 7, 14, or 30 days.

4. What do you do with the information you ask me to allow access to when I am installing the App?

Access to the information is necessary for creditworthiness assessment.

Zenka carries out the evaluation based on in-house developed tools for scoring the creditworthiness of potential and existing customers. Our tailor-made system verifies various data points, including checking the ownership and usage of phones, wallets, etc. 

5. I didn’t see Zenka in the list of the first lenders who got a licence. Are you legally able to operate and if not, why should I repay my loan?

Zenka was among the first lenders to submit all required documents to the CBK. However, patience is expected since dealing with 381 applicants takes a lot of work due to in-depth investigation.

The first 22 licences have already been granted; others (including Zenka's) are under review.

Following the CBK decision, all the applicants (Zenka among them) run their business as usual while waiting for a formal licence.


February is already here with us meaning there is no longer any excuse not to go full throttle in chasing our 2023 financial goals.

If you are going to require a digital loan, either to handle an emergency, to take advantage of a quick money-making opportunity or to pay for some urgent bills, it pays to be aware of which digital lender can be on your side at the time of your need.

Given the negative consequences of defaulting, it is important that every borrowing decision you make must factor in your ability to repay – on time and in full. 

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Eric Ndubi is the Managing Editor at Money254. He holds an MSc in Media and Communications from the London School of Economics and Political Science. Prior to leading Money254's editorial team, he worked as the Editor at, social media manager at Citizen TV and editorial manager at You can find him on twitter @Eric_Ndubi

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