Kenyan Lender Hits 92% On-Time Repayment in Tough Market

A Kenyan small business lender is defying gravity in one of Africa's toughest credit markets, proving that old-fashioned relationship building still works in the digital age.

4G Capital reports that 92% of its customers repay on time, a remarkable achievement while Kenya's overall banking sector wrestles with bad loans hitting 15.5%. The difference? They visit every single first-time borrower before handing over a single shilling.

"If you own a shop in Kawangware and need working capital, one of our loan officers will visit your business," CEO Julian Mitchell explained at a recent tech summit in Nairobi. "We don't believe first-time lending to micro and small businesses should be done purely remotely."

Instead of relying solely on algorithms, 4G Capital's officers walk into shops, count inventory, watch customer traffic, and talk to business owners about their supplier cycles. They're looking at stock turnover and daily sales patterns to figure out exactly how much each entrepreneur can realistically repay.

That human insight feeds into EVA, the company's automated decision engine, which processes the data in real time. Loan decisions happen on the spot, but they're grounded in what the officer actually witnessed at the business.

Since 2012, this hybrid model has delivered $889 million across 6.8 million loans to more than 723,000 small business owners in Kenya and Uganda. They process roughly 120,000 loans monthly, ranging from $30 to $2,000, all distributed through mobile money.

The relationship doesn't end at disbursement. The same loan officer who visited the shop continues checking in, providing business training, and building trust. Customers know that repaying on time unlocks larger loans as their businesses grow.

The Ripple Effect

This isn't just good news for a single lender. It's proof that micro-enterprises in rural Africa can be excellent credit risks when given the right support structure.

Seventy-two percent of 4G Capital's customers are women, and 81% operate in rural markets where traditional banks rarely venture. The company reports that customer revenues increase by an average of 82%, and borrowing capacity typically doubles over 36 months as businesses expand.

Unlike purely digital lenders that have struggled with high default rates in East Africa, 4G Capital's field operations create accountability through genuine relationships. Borrowers aren't just account numbers; they're shop owners who know their loan officer by name.

The model works financially too. Between 2016 and 2020, just $9 million in capital supported over $230 million in lending, funded primarily through local currency bonds and partnerships with Kenyan banks and impact investors.

Mitchell credits the company's success to discipline at every stage. "Strong repayment rates are not accidental. They are the result of disciplined lending, structured training, relationship-based engagement, and consistent use of data."

In a continent where financial inclusion remains a massive challenge, 4G Capital is showing that the solution might not be choosing between high-tech and high-touch—it's using both together.