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Saving is the cornerstone of financial stability and growth. In today’s fast-paced world, having a reliable, accessible, and secure place to save is essential. Fortunately, the M-Shwari Lock Savings Account offers all of these.
M-Shwari Lock Savings Account is a financial tool offered by Safaricom a leading Kenyan mobile operator. Popularly known as MShwari, this financial product allows customers to save money and also secure credit from the company.
If you’re enthusiastic about saving, this guide is for you as it covers the following:
- How the M-Shwari Lock Savings Account works
- Benefits of M-Shwari
- The interest rates of M-Shwari account
- How to deposit money in M-Shwari account
Let’s take an inside look!
How Does the M-Shwari Lock Savings Account Work?
The M-Shwari Lock Savings Account is an innovative savings product designed to help you set aside money for a specific goal over a fixed period. The common period is usually three, six, or twelve months.
Once you open the account and select your savings period, you’ll deposit your chosen target amount, which is then “locked in” for the duration. During this period, you won’t have access to withdraw funds, allowing you to build up your savings without the temptation of spending them impulsively.
To set up an M-Shwari Lock Savings Account, follow these steps:
- Access M-Shwari through the M-Pesa menu on your Safaricom mobile phone.
- Select “M-Shwari Lock Savings Account” from the available options.
- Enter your target amount—this is the goal amount you wish to save.
- Choose your saving period (3, 6, or 12 months).
- Make your initial deposit and start growing your savings immediately.
Once you’ve set your target amount and term, you can continue adding funds to your lock savings account anytime within that period. At the end of your selected savings term, you’ll be able to access the entire amount plus any earned interest.
Benefits of Saving with M-Shwari
Saving with M-Shwari comes with several key benefits that make it an appealing option for many people:
1. Convenience
With M-Shwari, you can save directly from your phone without needing to visit a bank. This accessibility is especially useful if you have a busy schedule or live far from a physical bank branch.
2. Financial Discipline
The “lock” feature helps you avoid unnecessary withdrawals, encouraging you to commit to your savings plan and meet your financial goals.
3. Flexibility
You can choose your saving period and the target amount, tailoring your M-Shwari Lock Savings Account to your personal financial goals, whether it’s saving for a holiday, an emergency fund, or a business investment.
4. Interest Earnings
Unlike traditional M-Pesa balances that don’t earn interest, the M-Shwari Lock Savings Account offers competitive interest rates that help grow your savings over time. You’ll have more money at the end of your savings period than you initially deposited, thanks to interest accumulation.
5. Security
M-Shwari is backed by Safaricom and the Commercial Bank of Africa (CBA), providing you with a high level of security and reliability.
Does M-Shwari Earn Interest? (M-Shwari Interest Rate on Savings)
Yes, the M-Shwari Lock Savings Account earns interest! One of the significant advantages of using this account is its attractive interest rate. Currently, M-Shwari offers an interest rate that ranges between 3% and 6% per annum on the amount saved, depending on your selected lock period.
The longer the period you choose, the higher the interest rate you’re likely to earn. This rate is competitive compared to many other savings products, especially considering the flexibility and convenience of the M-Shwari platform.
Your interest is calculated daily and is paid out at the end of the savings term. For instance, if you choose a 6-month period, your interest will be added to your balance when you complete the 6-month term.
This compounding effect can significantly boost your savings over time, helping you reach your goals faster.
What is the Maximum Amount M-Shwari Can Hold?
M-Shwari allows you to save up to Ksh 300,000 in your lock savings account. This limit makes it a great option for various savings goals, whether you’re setting aside funds for emergencies, investments, or larger purchases.
The maximum amount you can deposit in one transaction is Ksh 100,000. However, if you wish to save more than Ksh 100,000, you can do so through multiple deposits as long as you stay within the account’s overall Ksh 300,000 limit.
Setting Your Target Amount with M-Shwari Lock Savings Account
When opening an M-Shwari Lock Savings Account, you’ll set a specific target amount, which represents the financial goal you’re working toward.
This target amount can be any sum that aligns with your objectives, whether it’s a modest Ksh 5,000 for a short-term purchase or a larger sum closer to the Ksh 300,000 limit for significant investments.
The target amount helps you stay focused and motivated, and M-Shwari’s user-friendly interface makes it easy to track your progress toward that goal.
The target amount is simply a way to keep yourself accountable, so you don’t necessarily have to reach the full amount you set. However, having a goal in mind can provide structure to your savings journey and make it easier to stay on track.
Making Deposits with the M-Shwari Paybill Number
Funding your M-Shwari Lock Savings Account is simple, thanks to M-Pesa integration. To add money to your account, you’ll use the M-Shwari Paybill number. Here’s how you can go about it:
- Open your M-Pesa menu.
- Select “Lipa na M-Pesa.”
- Choose “Paybill” and enter the M-Shwari Paybill number.
- In the account number field, enter your M-Pesa phone number.
- Enter the amount you want to deposit and confirm the transaction.
This process ensures that your deposits are secure and accessible on the go, making it easy to add funds whenever you have extra money to save.
M-Shwari CRB Clearance
A common question about M-Shwari is whether it affects your Credit Reference Bureau (CRB) status, particularly if you use M-Shwari for both savings and loans. Here’s what you need to know:
- CRB Listing for Loans: If you take an M-Shwari loan and fail to repay it within the agreed period, you may be listed with the CRB. This listing could impact your credit rating and affect your ability to access future loans with M-Shwari and other financial institutions.
- No CRB Impact for Savings: Using the M-Shwari Lock Savings Account alone will not affect your CRB status, as savings activity is not reported to the CRB. You can use this account confidently for savings purposes without concern about credit rating impacts.
If you’ve had issues with CRB listing due to an M-Shwari loan, paying off the outstanding balance can help clear your CRB record. You can check your CRB status and request clearance through authorized CRB agencies if needed.
Additional Tips for Maximizing Your M-Shwari Lock Savings Account
1. Set Realistic Goals: When choosing your target amount and saving period, set achievable goals that align with your income and financial obligations.
2. Automate Your Savings: Consider setting up regular contributions to your M-Shwari Lock Savings Account to stay consistent. For example, after receiving your salary, immediately transfer a set portion to your lock savings.
3. Avoid Unnecessary Loans: While M-Shwari offers quick loans, avoid taking unnecessary loans that could hinder your savings progress or impact your CRB status. Prioritize saving over borrowing unless the loan is essential.
4. Take Advantage of Compound Interest: The longer you leave your savings untouched, the more interest you’ll earn, thanks to compounding. Consider choosing a 6- or 12-month period to maximize interest earnings.
5. Track Your Progress: M-Shwari offers an easy-to-use interface where you can monitor your savings progress, check the interest earned, and see how close you are to reaching your target amount.
Also Read:
- How To Register Safaricom Pochi La Biashara In 2024
- How To Withdraw from PayPal To M-PESA: A Step-by-Step Guide
Why M-Shwari Lock Savings Account is a Smart Choice
The M-Shwari Lock Savings Account is an accessible and effective savings tool that helps you stay disciplined and meet your financial goals. Its unique “lock” feature, coupled with competitive interest rates and the security of the M-Pesa platform, make it a standout option for anyone looking to build a solid savings foundation.
Whether you’re saving for emergencies, planning a future purchase, or simply looking to grow your money safely, the M-Shwari Lock Savings Account provides a reliable, structured way to achieve your financial goals.
By committing to your M-Shwari Lock Savings Account and regularly depositing funds, you’ll cultivate the financial discipline needed to thrive. Plus, with the added benefit of interest earnings, you’re not just setting money aside—you’re making it work for you.
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