Faulu Kenya, a microfinance bank based in Nairobi, recently signed a partnership deal with PesaPoint, a private company that provides automated teller machine (ATM) services, that will allow its customers to withdraw cash and access previously approved loans from ATMs across Kenya. By expanding service availability through such partnerships, Faulu Kenya plans to expand its client base to 1.5 million from the current 200,000 customers over the next two years according to John Mwara, the bank’s chief executive officer. In July 2008, Faulu Kenya signed a similar partnership deal with the Postal Corporation of Kenya so that its clients could access previously approved loans from any PostaPay outlet, an instant money transfer service of the Postal Corporation of Kenya. Faulu Kenya has also introduced short message services (SMS) – the equivalent of text messaging – that allow its clients to view their balances, request account statements and transfer money using their mobile phones.
Faulu Kenya, as of 2009, had USD 47.7 million in total assets, a gross loan portfolio of USD 37.6 million, 91,105 active borrowers, a ROA of negative 1.11 percent and ROE of negative 7.08 percent.
By Conner Brannen, Research Assistant
About Faulu Kenya:
Faulu Kenya was founded in 1992 as a pilot microlending program of Food for the Hungry International (FHI), a relief and development organization based in the USA. In 1999 it spun off into a limited liability company 70 percent owned by FHI. According to the Microfinance Information Exchange (MIX) Market, by year-end 2008, Faulu Kenya had USD 47.7 million in total assets, a gross loan portfolio of USD 37.6 million, 91,105 active borrowers, a ROA of negative 1.11 percent and ROE of negative 7.08 percent.
About PesaPoint:
PesaPoint is a private company registered in March 2005. It is part of the Paynet Group, which also includes Paynet Kenya, EFT Kenya and Paynet Zimbabwe. The goal of PesaPoint is to provide Kenyans easy access to their funds. Its strategy is to give various financial institutions an opportunity to provide automated teller machine (ATM) services to their customers while still concentrating on their core business. There is no financial information available for PesaPoint.
Sources and Additional Resources:
AllVoices: “Faulu Kenya set to grow client base,” by Edith Musyoki, June 7, 2010: http://www.allvoices.com/contributed-news/6010038-faulu-kenya-set-to-grow-client-base
MicroCapital Universe Profile: Faulu Kenya: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Faulu+Kenya
MicroCapital Universe Profile: PesaPoint: https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=PesaPoint
MICROCAPITAL BRIEF: Faulu Advisory Services of Kenya has Acquired Trustmark Insurance to Diversify Services, Provide Microinsurance, November 25, 2009: https://www.microcapital.org/microcapitalorg-brief-faulu-advisory-services-of-kenya-has-acquired-trustmark-insurance-to-diversify-services-provide-microinsurance/
MICROCAPITAL STORY: Faulu Kenya, International Finance Corporation (IFC), and Standard Chartered Bank Form Partnership to Extend Microfinance Operations in Kenya with $5.9m Loan, July 21, 2009: https://www.microcapital.org/microcapitalorg-story-faulu-kenya-international-finance-corporation-ifc-and-standard-charter-bank-form-partnership-to-extend-microfinance-operations-in-kenya-with-59m-loan/
MICROCAPITAL STORY: Faulu Becomes First Microfinance Institution in Kenya Licensed to Take Deposits, June 23, 2009: https://www.microcapital.org/microcapital-story-faulu-becomes-first-microfinance-institution-in-kenya-licensed-to-take-deposits/
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