With the growing competition of globalization, strategic decision-makers have been faced with the competing interests of external and internal stakeholders such as greater diversity in corporate governance, undertaking more investments in corporate social responsibility, and maximizing financial performance. As a result, strategic decision-makers today must not only increase their financial performance but also satisfy the increasing expectations of customers, suppliers, and society as a whole.
In developed countries, access to finance is largely taken for granted. But in low-income economies, financial participation is still highly underdeveloped. Even today, more than 1.7 billion people around the world count as unbanked the majority in Asia-Pacific and Africa.
Microfinance – which are s loans from as little as Kshs. 10,000 and other basic financial services – can play a critical role in increasing the financial independence of these underserved individuals, improving financial inclusion, and stimulating broader economic growth.
COVID-19, soaring inflation, and rising energy and food insecurity threaten to send 75 million to 95 million more people into extreme poverty this year. That makes helping the unbanked a greater priority than ever and Mwananchi Credit is at the forefront in assisting Kenyans realize this development of financial health.
Mwananchi Credit partners with many SMEs, the government of Kenya, and individuals in the region, as part of its efforts to lift participation in underserved communities. Mwananchi has over 4000 active customers in rural, semi-urban, and urban areas, and manages Over 2.5 billion in assets. Many of its borrowers are local entrepreneurs and Individuals
“Our responsibility is not restricted merely to financial support, but also to building borrowers’ capability to manage their financials on their own,” says Gitonga Muriithi, the general, Manager of Mwananchi Credit
“We run various financial literacy workshops and community development programs as part of the Sustainable Development Goals to make this possible.”
Microloans from Mwananchi Credit have had a huge impact. Such loans have boosted household income for 7 in 10 recipients and improved living standards for 9 in 10 users.
Mwananchi Credit has fully embraced Technology and this has reduced costs, increase efficiency and allow Mwananchi Credit to reach new clients.
Clients can now repay loans through their mobile phones, which avoids the risks of cash in transit and affords vital access to clients
Moreover, mobile technology and data analytics are facilitating new approaches to credit scoring, decision-making, and underwriting, for underwriting Shimin Insurance is ranking high on service provision.
The potential for Mwananchi Credit is huge, with an expected rise of more than 60 percent in such loans between now and 2026.
The Mwananchi Credit effect so far
- 88 percent of our borrowers agree their quality of life has improved
- 34 percent say the quality of life is ‘very much improved’
- 73 percent of borrowers report increased household incomes
- Seven out of 1 say personal savings and financial resilience have improved
Give a man a fish, he’ll eat for a day. Give a Kenyan family microcredit, the extended family will eat for a lifetime…… Gitonga Muriithi
The article was written by Gitonga Muriithi, General Manager of Mwananchi Credit June 23rd 2023