NAIROBI, Kenya — Co‑operative Bank of Kenya has rolled out a new digital overdraft facility branded ‘Kamilisha’, allowing account holders to overdraw up to Sh100,000 to complete transactions when their funds fall short.
The new offering places the bank in direct competition with Equity Bank Kenya’s Boostika product and Fuliza—the latter run by Safaricom in partnership with KCB and NCBA—both of which already allow short-term overdraft access (Boostika up to Sh100,000, Fuliza up to Sh70,000).
Key Terms of Kamilisha
- Customers pay a 2% one-off access fee on the borrowed amount.
- A daily maintenance fee of 0.2% applies to the outstanding balance.
- A monthly credit life insurance charge of 0.034% applies.
- An excise duty of 20% is applied on the access fee.
- For a Sh1,000 overdraft retained for one month, the total cost comes to about Sh84.34, translating to an effective monthly rate of approximately 8.43%.
- Repayment is due within 30 days, with automatic recovery from future account inflows.
- Limit eligibility is based on credit scoring: account transaction history, salary/business turnover influence the qualifying amount.
By entering the short-term credit and digital overdraft niche with a competitive limit and digital onboarding, Co-op Bank signals its intent to grow its market share in the fintech-enabled lending space.
The move reflects rising pressure on traditional banks to innovate amid rapid disruption by telco-bank partnerships and non-bank lenders.
For consumers, Kamilisha offers flexibility to bridge cash-flow gaps for payments like rent, utilities, stock orders, or money transfers, at a cost that sits competitive with existing alternatives.
However, borrowers should remain aware of the fees and maintenance charges that accumulate.
As the digital credit market expands in Kenya, this launch raises broader questions around oversight, responsible lending, transparency of cost, and how overdraft products compare to traditional unsecured loans.
