Branch Loans: How to Apply, Repay, and Boost Your Loan Limit

Branch International has completely changed how we look at finance. Branch is a popular organization like M-pesa because it gives loans to various borrowers digitally, unlike traditional loan systems like banks. But what sets it apart from the many lenders in our landscape? Let us get started and see Branch Loans in detail.

What Is Branch?

Branch is a product of Branch International. Branch is a modern-day banking institution (Microfinance) that offers secure and affordable loans to those who access its platform. By this, we mean anyone entitled to the internet can access Branch Loans from any corner of Kenya. They use the Branch Loan App to cash out loans.

The Key Requirements for a Branch Loan

Before you jump into the business of Branch loans, you must meet a few requirements. You need:

• A registered Safaricom line with Mpesa.
• An Android-enabled smartphone.
• Your National ID number.
• With these in place, you can embark on your mobile lending journey with Branch.

Applying for a Branch Loan: Step by Step

Now that you know the requirements, let's walk through the process of applying for a Branch loan.

Step 1: Download the Branch App

Visit the Play Store on your smartphone, search for the Branch application, download, and install it.

Step 2: Create an Active Account

After installing their application, register and sign in to the app using your details. 

Step 3: Start the application  process

You can start applying for any loan amount by filling out the Application Form. Your correct full details, such as country of stay, ID number, and other legal documents, will be needed.

Step 4: Wait for Feedback

After submitting the form, wait to know your loan eligibility.

Step 5: Choose Your Loan Amount

Select the loan amount you wish to borrow (up to Kshs. 1,000 for first-time borrowers) if approved.

Step 6: Receive Your Loan

Once your application is approved, the funds will be sent directly to your Mpesa account.

Loan Limits and Interest Rates

Branch offers loan limits from Kshs 250 to Kshs 70,000. You can increase your loan limit by consistently repaying and borrowing early. Interest rates range from 10% to 27%, translating to a monthly interest rate of 1% to 21%.

Repaying Your Branch Loan

Repaying your Branch loan is simple. You can do this via Mpesa or the automatic pay feature within the app.

Repaying via Mpesa

Follow these steps:

a. Open the Mpesa Menu on your phone
b. Select the Lipa na Mpesa option
c. Choose the Paybill option
d. Enter the Paybill number 998608
e. Provide your Mpesa number as the account number
f. Enter your repayment amount
g. Input your M-PESA pin
h. Confirm the details and press 'OK.'

Automatic ATM Card Payments

Follow these steps:

a. In the Branch app, go to 'My Loan' and tap the round 'Tap to Pay' button
b. Choose the amount to repay and tap 'Continue.'
c. Add your debit card information
d. Confirm the details and press 'OK.'

Your payment will be processed, and your loan balance will be updated in the app.

How to Increase Your Branch Loan Limit

Increasing your loan limit in Branch is based on the trust you build over time. Here are some strategies you can employ to achieve higher loan limits:

Repay Your Loans On Time

Consistently repaying your loan on time shows that you're a reliable borrower. It increases your credit score and gives Branch more confidence in lending you higher amounts.

Increase Your Loan Frequency

The more often you take out and repay loans, the more trust you build with Branch. It is this trust that translates into higher loan limits.

Maintain Good Financial Health

Branch uses data from your Mpesa transactions to assess your financial behavior. Consistent deposits, frequent transactions, and a positive Mpesa balance contribute positively to your credit profile.

The Downsides of Branch Mobile Loans

Despite the convenience and speed that Branch loans provide, there are a few downsides that you need to consider.

High-Interest Rates

While the rates may seem low monthly, the annual percentage rate can range from 12% to 252%. This is significantly higher than most traditional bank loans.

Privacy Concerns

Regarding user Privacy, the Branch Loan App and organization are on the top of the Mountain. However, you need some legal procedure that they use to assess your creditworthiness. They must access your past MPESA transactions to ascertain they can give you the loan. This can be a limiting factor if you're not ready for this.

READ ALSO: Stanbic Bank Internet Banking: How To Register, login, and Services Available

Conclusion

Branch International is revolutionizing mobile lending, providing easy access to credit for millions. Its algorithms offer personalized loan products tailored to individual needs. By understanding the application process, repayment methods, and how to increase your loan limit, you can maximize your benefits from this platform. However, it's crucial to borrow responsibly and consider the interest rates and privacy implications before getting a loan. With this knowledge, you're now ready to navigate the business of Branch mobile lending.

Frequently Asked Questions (FAQs)

How does Branch determine my loan limit?

Branch uses machine learning algorithms to analyze the data on your phone, such as your Mpesa transaction history and other financial information, to determine your credit score and loan limit.

Can I have multiple Branch accounts?

No, Branch only allows one account per individual. 

How long does it take for my loan to be approved?

The same Loan approval time has yet to be known for sure. However, given that you comply with all the rules put forward by Branch, you can be sure to receive your money faster rate.

Are there penalties for late repayments?

Yes, late repayments can result in penalties and negatively impact your credit score, limiting your ability to secure future loans from Branch and other lenders.

Can I repay my loan in installments?

Yes, you can make partial payments toward your loan. However, paying the total amount by the due date is essential to avoid penalties and maintain a good credit score.