Kenya, Africa

KEN03c - FOB Revolving Fund: Partnership Reports

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Report Date: July 28, 2014

Report from BHW Field Director Following Visit in July


Recent Events

FOB Revolving Fund

making a paymentThe fund is going very well. There is an active board that is making good decisions. Muthui is not so directly involved now, he just keeps a watching brief on it although is still the one who makes the final call on new spending and borrowers.

Larger groups are now using it more regularly that individual borrowers. Entities can be members as well as individuals.

There is also an increase in shorter term loans (less than 6 months) rather than long term (up to three years).

One or two non members borrow from time to time as well. They are charged 10% interest per annum rather than members at 5%. Some are using it for bridging finance.

They regularly hold education days for members and those wanting to join. They are in search mode for more members. FOB is ready to grow and turn more “dreams into reality,” the new name possibly. 

Table Loans

keeping accountableThe advent of table loans has contributed to less individuals joining the FOB programme. However, once people have increased their capital in the table loans they are encouraged to move into the FOB programme. The interest rate is still a lot lower than commercial rates so there are good reasons to do this. 

The three pilot table loan programmes are proving to be very popular and empowering. They have been functioning for just over a year. 

1) Dagoretti programme meets every week and started with six people. Their number has increased to around 15 and their capital is around KES180,000 (just over US$2,100). They started with KES6,000.

2) Kimathi programme meets monthly and started with five people. Their number has risen to 15. Their capital is now around KES130,000 (US$1,530). At the last meeting they had KES20,000 they could not lend out as no one had any immediate plans or needs. 

3) Kamulu started with five people and has grown to 10 people with around KES80,000 capital (US$1,000).

This is a huge growth and they are very excited. Most have never had savings ever in their lives before. 

FOB has been assisting with the development of these table loan groups. They pay for the initial training of the groups. Jaqueline comes in to do that. Also, once during the year each group received a boost from FOB. This was for three months and was an interest free loan. All groups repaid within the time and it was a huge encouragement to them.


Personal Stories

There have been three very positive, non-economic outcomes from the table loans;

1) Fellowship – people are getting together regularly and with a purpose that is addressing the real issues they face from day to day. They pray together and become very close. Now that there is talk of splitting the groups, there is resistance. 

2) Discipleship – they are now accountable and this is bringing shape to their lives and discipline into their lives, some for the first time. It is strengthening them in their faith.

3) Reconciliation – people are coming back together, people who once split apart are now sitting together and sharing their lives. This has been a real surprise, a never dreamed of outcome. 


Partnership's Influence within the Community

The community is responding very positively to this and to the table loans. People are constantly asking to join but they are not increasing the number yet until they understand all the dynamics of operating them. People want to leave other loan programmes to join these as they are so effective. 

On the 3rd August the three leaders from each of the three groups will be meeting to discuss the progress and where to take it next. The thinking is that the groups will be split and then each will grow again.  


Ideas for the Future

The vision to grow the FOB is now much clearer and closer to reality. The growth of the table loans is a major strength of this programme now. It requires little input and involves a lot of people. 

I think it’s worth investing in FOB for one more year at the previous level and then review it. The purpose of doing this would be to establish a fund that could be used to boost the table loans, as a loan. At the moment, the FOB is at capacity with its members.


Current Issues and Challenges

very busy manThere are no major ones at present although Muthui has been very busy (finishing off his Masters study) and Hannah has been very unwell. The concept of expanding the programmes, both FOB and table loans is moving slowly, but continuously forward. 

The discussions about growing the number of table loan groups will be interesting to observe.  


Prayer and Praise Points

1) The success of the table loan pilot programmes
2) That the growth of the table loans will go ahead without any hitches
3) That new leaders will emerge to lead new groups
4) That there will be a wave of development in this programme over time and that it will be able to be replicated
5) For Muthui, who is very busy 



I think this is a major success at the pilot level. There is potential with this model to seriously help people and it is entirely transferable. 

There is great potential in the table loans, especially when backed up by the FOB fund. This provides a pathway for very poor people to start at the table, grow their equity and learn a lot about managing their resources and then to move on to further financial growth.