- Established in 2010
- World pioneer of mobile microfinance with cash-less transactions
- Kes 100m+ outstanding loan balance in Q1 2012
- 5,000+ active borrowers in Q1 2012
- 10,000+ loans disbursed in Q1 2012
- Women make up 65% of active borrowers
- 5% of clients are rural
- 5 branches in Kenya; more in future
- Current shareholders: Musoni BV, Grameen Foundation, KfW and CARE’s Access Africa Fund.
Musoni Kenya is a microfinance institution (MFI) that was established in 2010 by Musoni BV, a Dutch holding company responsible for IT, fundraising and general oversight. It was set up to improve the quality and accessibility of financial services available to the poor, especially in rural Kenya. It is the first MFI in the world to exclusively use mobile money. All loans are disbursed and repaid using the mobile phone, making Musoni entirely cash-free.
Agriculture in Kenya contributes about 30 percent of the Gross Domestic Product (GDP) and accounts for 80 percent of national employment, mainly in the rural areas. Also, over 70 percent of food production in Kenya is done by smallholder farmers hence contributing to food security for the nation.
However, access to financial services is still a key challenge, especially in the rural areas where it is much needed to finance agriculture. Because of the poor infrastructure, financial services prefer to locate their branches in and near urban areas. And the few financial institutions operating in rural areas lack the proper products to finance agriculture. The latest study on financial inclusion in Kenya (FinAccess 2009) estimates that over 65 percent of the rural population is either totally excluded or only accessing informal financial services, with women among the most affected.
Hivos seeks to build microfinance institutions that are operating in or are keen to go into rural areas. We have therefore partnered with Musoni because it is charting a new way of delivering financial services to microfinance clients through the use of efficient ICT technologies that drastically reduce the cost of doing business in remote areas wherever a mobile phone network exists. For example, Musoni has just launched an App that digitalises its client and group registration processes. This improves efficiency, enables them to bring financial services to more remote areas and further improves client experience. And in an effort to bypass banks and make microfinance more efficient, Musoni has gone completely cashless and digital.
Hivos believes that this innovative business model could in the future make it easier for MFIs to expand their networks into rural areas and offer affordable products and services that suit the needs of smallholder farmers.