Namibia’s microlending sector comprises 910 registered lenders with a combined N$7.8 billion in outstanding loans by the end of the third quarter (September), with term lenders dominating activity.
According to the Namibia Financial Institutions Supervisory Authority quarterly report, between July to September, Namibians borrowed N$1.4 billion from cash loans.
These loans are primarily made up of term lenders, which accounted for 92% of the total loan book.
Leading the pack is Entrepo Finance, followed by Letshego Micro Financial Services and Old Mutual Finance.
Collectively these entities control 80% of the term lender sector.
“Term lenders’ disbursements fell sharply by 13.9% to N$774.1 million. In contrast, payday lenders partially offset this decline, recording a modest 0.4% increase as their disbursements rose to N$615.3 million during the period,” reads the report.
The payday lender market was dominated by Express Credit Cash Advance, followed by Janeel Financial Services, and Bellatrix SME Finance.
According to the report the number of borrowers in the microlending sector increased to 278 841 clients.
The growth was driven primarily by term lenders with a client base of 172 393, while payday-lending clients rose by 3.4% to 106 448 clients.
“As a result, term borrowers continued to dominate, accounting for 62% of the total clients, compared with 38% for payday borrowers at the end of the review period,” reads the report.
Meanwhile, the number of new loans issued increased by 4.1% quarter-on-quarter, reaching 186 872 loans.
The report shows that the average term-lending loan value remained unchanged at N$33 183.
Payday lenders experienced a quarterly decline in average loan size, with the average amount decreasing by 6.4% to N$3 762.
“These movements suggest that payday borrowers opted for slightly smaller loan values during the review period, whereas term lending continued to reflect sustained demand for higher-value credit,” reads the report.
A total of 19 complaints were lodged in the microlending sector, of which 15 have been resolved, with borrowers refunded over N$31 000.
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