STORY // Kenya :: Revolving Fund

Another project I worked on in Kenya was a revolving fund project in Nairobi run by a local ministry.  A revolving fund is this… A org is set up with a board and they then take members.  The members pay money each month into the fund.  After about 6 months a member then can take out a loan from the fund (up to 3 times of the amount he has shares in the fund).  To take the loan he has to have 3 other members serve as guarantee’s for his loan.  The loan is then paid back with only 1% interest.  Term lengths vary from each loan.  Once the loan is paid back they could take another loan.  The whole time they have to continue pay their monthly shares.  A member could withdraw from the fund and all of the shares they have imputed into the fund if he ever wanted to.  In a sense it is acting as a bank that teaches people to consistently save, walks people through taking loans that are smart and provides accountability that way and doesn’t have all the crazy fees that every bank in Africa seems to have.  Enabling people to improve the quality of life for themselves and others.

It’s always great seeing the local church being a source of hope and active agent in poverty alleviation.  This isn’t some big huge western NGO.  It’s not a hand-out program that creates dependency.  It’s locals coming together, with an outside partner in the beginning, to help each other improve their way of life.  Incredible.

I interviewed people who have used loans and paid them back to improve a plot of land, bring electricity or running water to their home, pay for school fees, some for their children and others for continuing education, assist people in their small businesses, etc.

t w i t t e r