MICROCAPITAL BRIEF: Faulu Kenya, Airtel Form Partnership to Offer Mobile Credit

Faulu Kenya, a microfinance institution (MFI) based in Nairobi, Kenya, is now offering mobile credit to customers of the Kenyan arm of Airtel, an Indian telecommunications company. The partnership will give customers of Airtel Kenya access to loans through their mobile phones, overcoming infrastructure problems preventing many Kenyans from accessing banking services.

Customers can take out loans between KES 100 (USD 1.19) and KES 10,000 (USD 119), with interest rates between three and ten percent and a repayment period of 10 to 30 days. The maximum amount that can be borrowed is slated to be increased to KES 75,000 (USD 892) by 2013. Faulu Kenya customers also have access to Faulu Popote, a service mobile savings and money transfer for any mobile service provider.

Founded in 1992, Faulu Kenya has USD 54.4 million in total assets and a gross loan portfolio of USD 33.2 million as of 2010 according to the US-based non profit Microfinance Information Exchange (MIX). Founded in 1995, Airtel serves 243 customers in 20 countries across Asia, Africa and Europe.

By Brett Cohen, Research Associate

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 US. In 1999, it was spun off into a limited liability company 70-percent owned by FHI. According to the US-based non profit Microfinance Information Exchange (MIX), by year-end 2010, Faulu Kenya had USD 54.4 million in total assets, ROA of -3.38%, ROE of -44.82%, total deposits of USD 23 million, 85,226 active borrowers, and a gross loan portfolio of USD 33.2 million

About Airtel

Founded in 1995, Airtel is an Indian telecommunications company operating in 20 countries throughout Asia, Africa and Europe. As of 2012, Airtel has approximately 243 million customers. Airtel reported total assets of USD 20.1 billion in 2011.

Sources and Additional Resources

AllAfrica.com story: “Kenya: Faulu Offers Mobile Credit to Airtel Customers”

Faulu Kenya press release, “Faulu Popote”

MicroCapital.org story, April 16, 2012: “MICROCAPITAL BRIEF: European Investment Bank (EIB) Launches $65m East African Community Microfinance Facility”

MicroCapital.org story, April 7, 2012: “MICROCAPITAL BRIEF: Airtel, UT Bank Launch Mobile Savings Product FONBank in Ghana”

MicroCapital.org story, April 23, 2012: “MICROCAPITAL BRIEF: Financial Sector Deepening: Central Bank of Kenya Regulations Cuts Profits of Kenyan Microfinance Institutions”

MicroCapital Universe Profile: Faulu Kenya

Browse the MicroCapital Universe and add your entry to the wiki at https://www.microcapital.org/microfinanceuniverse/

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