MICROCAPITAL BRIEF: Kenyan Microfinance Institution Musoni Goes Completely Cashless

Musoni Kenya Limited, a microfinance institution based in Nairobi, reportedly will offer solely cashless lending services to its customers in an effort to increase efficiency and address security issues related to in-person transactions. To achieve this, Musoni staff will be outfitted with portable computer tablets that they can take into the field to use when interviewing potential customers and to collect data on existing ones. Once a loan application has been approved, the recipient’s funds will be deposited directly into his or her account with M-Pesa, a Kenyan mobile money service. Similarly, repayments are to be accepted only via M-Pesa.

According to 2012 data reported to US-based nonprofit Microfinance Information Exchange (MIX), Musoni has total assets of USD 2.5 million, a gross loan portfolio of USD 1.6 million and 7,242 active borrowers. Musoni’s products include education and enterprise loans. As of September 2012, M-Pesa serves approximately 19.2 million clients through 45,540 agent outlets.

By Lena Phillips, Research Associate

About Musoni Kenya Limited

Established in 2010, Musoni is a microfinance institution based in Nairobi, Kenya, that disburses loans only via the M-Pesa mobile money service. It offers three types of products: Nawiri Loans, for individuals; Stawi Loans, to assist in growing small businesses; and Tuelimike Loans, specifically for school fees. Each product offers flexible loan amounts and repayment schedules. According to 2012 data from the US-based nonprofit Microfinance Information Exchange (MIX), Musoni has total assets of USD 2.5 million, a gross loan portfolio of USD 1.6 million and 7,242 active borrowers. Musoni does not accept deposits.

About M-Pesa

M-Pesa is a Kenyan mobile money service. The “M” stands for “mobile,” and “pesa” means “cash” in Swahili. Launched in 2007 by Safaricom Limited, a Kenya-based cellphone service provider, M-Pesa was developed by Vodafone Group Private Limited Corporation, a British multinational mobile network operator. As of September 2012, M-Pesa serves approximately 19.2 million clients through 45,540 agent outlets.

Sources and Additional Resources:

Economist.com Article, February 18, 2013, “Bit loans,” http://www.economist.com/blogs/schumpeter/2013/02/microfinance

MicroCapital.org Article, 2 November 2012: “MICROCAPITAL BRIEF: Vodafone’s M-Pesa Mobile Money Service to Expand International Options with HomeSend Partnership,” https://www.microcapital.org/microcapital-brief-vodafones-m-pesa-mobile-money-service-to-expand-international-options-with-homesend-partnership/

MicroCapital.org Article, 23 May 2012: “MICROCAPITAL BRIEF: Grameen Foundation, KfW Bankengruppe, Access Africa Fund Invest in Mobile Microfinance Institution Musoni Kenya,” https://www.microcapital.org/microcapital-brief-grameen-foundation-kfw-bankengruppe-access-africa-fund-invest-in-mobile-microfinance-institution-musoni-kenya/

MicroCapital Universe Profile: Musoni Kenya Limited, https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Musoni+Kenya+Limited

MicroCapital Universe Profile: M-Pesa, http://microcapital.org/microfinanceuniverse/tiki-index.php?page=M-Pesa

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