Glossary
Loan vocabulary, decoded.
The jargon Kenyan borrowers most often ask us to explain. Bookmark this page.
- Reducing balance
- An interest model where interest is calculated on the outstanding loan principal each month, so as you repay, the interest portion drops.
- Flat rate
- Interest charged on the original loan amount for the full tenor, regardless of repayments. Almost always more expensive than a comparable reducing-balance rate.
- APR
- Annual Percentage Rate, the true yearly cost of a loan, including fees, expressed as a percentage.
- Disbursement
- The act of the lender sending the loan funds to your account. With us: 100% of qualified amount, no deductions.
- Loan-to-value (LTV)
- The loan amount as a percentage of the asset's market value. Our partner caps LTV at 90%.
- Joint registration
- A NTSA filing recording the lender's interest in your logbook for the duration of the loan. Removed when you finish repaying.
- Tenor
- The length of the loan, in months. Range: 3 to 36 months.
- CRB
- Credit Reference Bureau. A regulated body that maintains credit histories. We check, but a negative listing is not an automatic disqualification.
- KYC
- Know Your Customer, the regulatory process of verifying a borrower's identity and source of funds.
- Default
- Failure to make a scheduled repayment after the cure window. Triggers our partner's published collections process with restructuring first, recovery as a last resort.