In the fast-paced world of mobile money, Fuliza and M-Shwari have become household names in Kenya.

Both services offer short-term financial solutions through M-Pesa, yet many Kenyans use them daily without fully understanding how they work or how they differ.

If you’ve ever wondered whether Fuliza or M-Shwari is the better option for your situation, this detailed comparison will break it down clearly.

How Fuliza Works in Kenya

Fuliza is an overdraft service offered by Safaricom in partnership with NCBA and KCB Bank. It allows M-Pesa users to complete transactions even when they have insufficient funds in their mobile wallet.

For example, if you need to pay KES 500 but have only KES 200 in your M-Pesa account, Fuliza covers the KES 300 shortfall.

Fuliza isn’t technically a loan. It’s an overdraft facility that automatically kicks in when your M-Pesa balance is too low to complete a transaction.

Once you top up your wallet, the Fuliza amount is automatically recovered, making Fuliza loan repayment seamless and immediate.

What Are M-Shwari Loans?

M-Shwari, on the other hand, is a micro-lending and savings product offered through a partnership between Safaricom and NCBA.

To access M-Shwari loans in Kenya, users must first save regularly using the M-Shwari platform. The loan feature becomes available based on your savings history, M-Shwari credit score, and usage of Safaricom services.

Unlike Fuliza, M-Shwari offers a fixed-term loan, typically repaid in 30 days. This makes it more suitable for structured borrowing needs, such as capital for small businesses or emergency expenses requiring a lump sum.

Fuliza vs M-Shwari: Key Differences

Fuliza Interest Rates Kenya vs M-Shwari Fees

Fuliza charges a daily maintenance fee depending on the overdraft amount, and there’s also an access fee of 1% on the borrowed sum.

For example, if you borrow KES 1,000 on Fuliza and repay it after 5 days, you could pay over KES 60 in fees, higher than the M-Shwari 7.5% flat fee, which would amount to just KES 75 for a KES 1,000 loan over 30 days.

Therefore, Fuliza charges vs M-Shwari fees matter significantly, especially if you’re comparing costs over time.

M-Shwari is generally cheaper if you can plan your repayment in 30 days. However, Fuliza offers unmatched convenience for daily transactions and emergencies.

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Real-World Use Cases: Fuliza for Emergencies, M-Shwari for Small Business

Jane, a Nairobi-based shopkeeper, uses M-Shwari loans for small businesses in Kenya, borrowing KES 5,000 monthly to restock inventory. She repays it in 30 days after selling her goods, enjoying a predictable cost.

Brian, a boda boda rider in Kisumu, often uses Fuliza for emergencies in Kenya, especially for unexpected fuel costs or to complete a transaction when clients pay via M-Pesa and he needs to send change.

These case studies illustrate the difference between Fuliza and M-Shwari in Kenya: M-Shwari suits planned borrowing, while Fuliza supports daily expenses and unplanned gaps.

Requirements: Fuliza vs M-Shwari Loans

Fuliza:

• Must be an M-Pesa user for at least 6 months.
• Active M-Pesa usage improves your limit.
• No application required.

M-Shwari:

• Savings history with M-Shwari
• Use of Safaricom services (calls, SMS, data)
• Good loan repayment history to grow your M-Shwari credit score in Kenya

Which Is Better in 2025? Fuliza or M-Shwari?

If you’re asking, Is Fuliza better than M-Shwari in Kenya?, the answer depends on your needs:

• For quick access during checkout or emergencies, Fuliza is faster and automatic.
• For planned expenses or business needs, M-Shwari offers better rates and higher limits.

Both services are valuable tools, and many Kenyans use both depending on the situation. Understanding the mechanics, how to use Fuliza M-Pesa in 2025 and what makes M-Shwari vs Fuliza loans different can help you avoid unnecessary fees and use each platform strategically.

Best Mobile Loan: Fuliza or M-Shwari?

There is no one-size-fits-all answer to whether Fuliza or M-Shwari is the best mobile loan in Kenya. Your choice should be based on:

• Urgency of the need
• Amount required
• Repayment ability
• Willingness to pay higher fees for convenience

The best approach? Use M-Shwari savings and loans for long-term planning and Fuliza M-Pesa in Kenya as a backup for unavoidable shortfalls.

Ronnie Paul is a seasoned writer and analyst with a prolific portfolio of over 1,000 published articles, specialising in fintech, cryptocurrency, and digital finance at Africa Digest News.