Kuda is a digital-only bank that has been providing financial services to Nigerians since 2019. One of the most popular offerings from Kuda is their loan product, aptly named the “Kuda Loan.” This article will explore what the Kuda Loan is, how it works, and some of its benefits and drawbacks.
What is the Kuda Loan?
The Kuda Loan is a type of personal loan that is available to eligible Kuda customers. The loan amount ranges from N1,000 to N200,000, and the repayment period can be between 7 days and 30 days.
The loan is designed to provide quick access to cash for emergencies or unexpected expenses, such as medical bills, car repairs, or home improvements
How does the Kuda Loan work?
To be eligible for the Kuda Loan, you need to be a Kuda customer and have an active account. You can apply for the loan directly from the Kuda app, which is available for both Android and iOS devices. The loan application process is straightforward, and you can get a decision within minutes.
Once you’re approved for the loan, the money will be disbursed directly into your Kuda account. You can then use the funds for whatever purpose you need. The loan repayment will be automatically deducted from your Kuda account on the due date, so you don’t have to worry about making manual payments.
What are the benefits of the Kuda Loan?
One of the main benefits of the Kuda Loan is its speed and convenience.
You can apply for the loan from the comfort of your own home, and the funds will be disbursed within minutes if you’re approved. This is particularly useful in emergencies when you need cash quickly.
Another benefit of the Kuda Loan is its flexibility. You can borrow as little as N1,000 or as much as N200,000, depending on your needs. The repayment period can also be customized to suit your preferences, ranging from 7 days to 30 days.
The Kuda Loan is also available to a wide range of people. You don’t need to have a high credit score or provide collateral to be eligible for the loan. As long as you’re a Kuda customer and have an active account, you can apply for the loan.
What are the drawbacks of the Kuda Loan?
One of the main drawbacks of the Kuda Loan is its high-interest rate. The interest rate on the loan is 15%, which is significantly higher than traditional bank loans. This means that you’ll end up paying more in interest charges over the loan’s life, which can make the loan more expensive in the long run.
Another drawback of the Kuda Loan is its short repayment period. While the flexibility of the loan is a benefit, it can also be a drawback if you’re unable to repay the loan within the specified period. If you’re unable to repay the loan on time, you’ll be charged a late fee, which can add to the overall cost of the loan.
Finally, the Kuda Loan is only available to Kuda customers. If you don’t have a Kuda account, you won’t be able to apply for the loan. This means that if you’re not interested in using digital-only banks, you won’t be able to access this loan product.