In an internal Memo seen by The Star, the decision was reached after a series of discussions, beginning with a meeting that was held on February 25.
The company, however has moved quickly moved to dismiss claims that it has fired staff working in its check-off loan department insisting that it is streamlining the operations to serve customers better.
Mwananchi Credit human resource manager Collins Okello said that all those who worked in the department have been asked to re-apply for their jobs again with interviews set to commence from Tuesday.
“Despite concerted efforts to enhance collections and strengthen financial accountability, the product has continued to underperform. Several team leaders have not met the expected targets, resulting in significant financial losses,” said Okello.
The restructuring comes after a series of high-level discussions, during which key concerns about loan collections, non-performing loans, and commission structures were raised.
Despite efforts to enhance financial accountability and improve collections, the checkoff loan product continued to underperform, resulting in substantial financial setbacks for the company.
The company has acknowledged the contributions of employees who have worked within the checkoff loan department and has assured them of support during this transition period.
The company’s decision highlights a growing challenge within the financial sector, where non-performing loans and inefficiencies in collection strategies have forced companies to rethink their credit offerings.
The move could signal a broader industry shift, with other institutions potentially following suit to minimize financial risks and enhance profitability.
With restructuring efforts underway, Mwananchi now faces the task of transitioning affected employees and ensuring that financial accountability measures are met.
The outcome of this decision will likely shape the company’s future financial strategy as it seeks to strengthen its business model.
The firm is best known for its logbook loans, which allow vehicle owners to use their logbooks as collateral in exchange for quick financing.
Mwananchi has been offering the best loans to clients all over the country
It also offers salary check-off loans, a facility widely used by government employees such as teachers, police officers, and other civil servants.