Cases involving aggressive loan recovery practices continue to raise concern across Kenya, especially among small business owners who rely on credit to survive. One such case directly involves MyCredit Limited, a non-bank financial services firm, after a borrower lost his commercial vehicle following a loan dispute that he says was handled in a harsh and unfair manner.
The borrower shared his experience with investigative journalist Cyprian Is Nyakundi, explaining how a loan he took from MyCredit Limited’s Kisumu branch ended with the seizure and sale of his lorry.
According to him, the loan was meant to help him deal with an urgent financial situation, but it instead destroyed his only source of income.
He says the process exposed him to strict terms, limited flexibility, and actions that he believes ignored both fairness and existing court orders.
In his account, the borrower explains that he applied for a loan of Ksh 300,000 and was required to surrender his vehicle logbook as collateral. However, he says the full amount never reached him.
A portion was deducted immediately, and only Ksh 263,000 was sent to his M-Pesa account.
The loan was to be repaid within six months. Even though he felt the terms were punitive, he agreed because he needed the money urgently to keep his business running.
Trouble started three months into the loan when he fell behind on repayments. MyCredit Limited agents moved in and seized his lorry, which he depended on for daily income.
The vehicle was taken to Nyaluoyo Auctioneers yard in Kisumu. He says he was then asked to raise Ksh 150,000 as a lump sum to qualify for a loan restructure.
At that time, he had no income because the lorry had already been detained. He pleaded with the lender to release the vehicle so he could work and repay the loan, but that request was rejected.
With no progress, he sought legal help and took the matter to court. Court orders were issued directing that the vehicle be released under certain conditions.
One of the orders required him to pay Ksh 180,000 upfront and clear the balance in instalments. He says he was still unable to raise that amount. Despite the case being active in court, the vehicle was later moved from Kisumu to Nairobi, where it was sold.
What deeply troubled the borrower was the price at which the lorry was sold. He maintains that the vehicle was sold for Ksh 500,000, yet during the loan assessment process, it had been valued at Ksh 1.2 million. To him, this meant he lost a valuable asset without proper consideration of its market value, leaving him financially ruined.
Below are his sentimes as explained to Blogger Cyprian Is Nyakundi.
“Hello Cyprian. Mine was a loan I took with MyCredit Ltd at the Kisumu branch office. I pledged my logbook as collateral. They gave me 300k but deducted some amount and sent me 263k to my M-Pesa number.
The amount was to be returned in six months and since I was in need of urgent money I obliged to the terms though they looked very punitive. After three months into the loan process they came and took my lorry since I was in arrears.
They took the truck to Nyaluoyo Auctioneers yard in Kisumu. They demanded I pay a lump sum amount of 150k so they could do a restructure for the loan.
At that moment I did not have that amount since my commercial truck was now detained and I had no otherwise but to plead if they could at least release the truck so I work and repay the loan. They refused that option and continued to detain my vehicle at the yard.
I took the matter to court through a lawyer and orders were served that they stay the vehicle until the case is heard and determined.
The first order came that they release the truck but on condition that I pay a lump sum of Ksh 180,000 and clear the rest in instalments. To my disadvantage again I still could not raise such amount at that time.
They then transferred the vehicle from the auctioneers yard in Kisumu to Nairobi where they sold it at a significantly lower price of 500K yet the valuation we did at the time of loan assessment was Ksh 1.2 million market value.
Can I go to court and petition for damages because I have nothing left now since that was my only source of income to educate my children both in universities and secondary schools. Kindly help if you know something I can do to recover.”
The borrower says the loss of the lorry has left him with no income and no clear way to support his children, some of whom are in university and secondary school.
His case adds to growing concerns about how loan disputes are handled and whether borrowers are adequately protected when lenders move to recover assets.
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