Co-op Bank Launches Kamilisha, a New Digital Overdraft Facility

Co-operative Bank of Kenya has stepped into the fast-growing digital credit space with the launch of Kamilisha, a new short-term overdraft facility.

This facility lets customers top up their accounts instantly – up to Sh100,000 – whenever they fall short during payments.

The new product allows users to complete transactions such as bill payments, stock purchases, and money transfers even when their balances can’t cover the full amount.

It’s Co-op Bank’s latest move in the battle for Kenya’s digital lending market, going head-to-head with Equity Bank’s Eazzy Overdraft and Safaricom’s Fuliza service.

In a notice to their customers, the bank says:

“Kamilisha bridges the gap between what you have and what you need to finalize your payment, helping you stay on track financially,”

Kamilisha: Flexible, Affordable and Instant

Customers using Kamilisha will pay a 2% one-off access fee on the borrowed amount.

The access fee comes alongside a daily maintenance fee of 0.2% on the outstanding balance and a credit life insurance charge of 0.034% per month.

An excise duty of 20% applies to the access fees.

Altogether, that translates to roughly Sh84.34 per month, or an effective cost of about 8.4% per month, assuming the loan is fully used over that period.

In comparison, Fuliza charges around Ksh6 daily on a Sh1,000 overdraft – about Ksh180 a month – making Co-op’s new product notably cheaper.

Repayment and Access

Once activated, the access fee, excise duty, and insurance are deducted immediately.

Interest accrues daily and is recovered as soon as new funds are deposited into the customer’s account.

Borrowed amounts are due within 30 days from the first disbursement, and repayments are automatically deducted from subsequent deposits.

According to Co-op Bank, the overdraft limit will depend on each customer’s credit score, account usage and transaction patterns.

“We review salary deposits, business turnover, and account behavior to determine what you qualify for.

To grow your limit, just keep using Kamilisha actively and clear your balances promptly,” the bank explained.

Raising the Stakes in Digital Lending

With Kamilisha, Co-op Bank joins the digital credit race that has long been dominated by telcos and fintechs.

The lender already offers a suite of digital products – including salary advances and the popular Co-op kwa Maji loan – as it continues strengthening its position in the mobile lending ecosystem.

As competition tightens, Co-op’s Kamilisha is likely to appeal to customers seeking a reliable, regulated, and fairly priced overdraft service – especially those who’ve grown weary of the steep daily rates associated with existing lenders.