MICROCAPITAL BRIEF: MFI Juhudi Kilimo of Kenya Upgrades Digital Infrastructure with Technical Assistance from Nordic Microfinance Initiative

The Nordic Microfinance Initiative (NMI), a Norway-based public-private partnership that supports microfinance institutions (MFIs) in developing countries, recently worked with Juhudi Kilimo, a for-profit microfinance institution in Kenya, to help it develop a mobile app that gives staff members remote access to client data. The process began with a “deep assessment of Juhudi’s IT [information technology] challenges and options.” The resulting app has reportedly “helped simplify operations, improved client risk analysis, expanded the company’s lending approach and diminished operational costs per client.” Juhudi Kilimo financed 20 percent of the cost, with the remainder borne by NMI’s Technical Assistance Facility, which is funded by the Norwegian Agency for Development Cooperation (Norad).

Juhudi Kilimo began operations in 2004 within the Kenyan nonprofit K-Rep Development Agency and became independent in 2009. As of 2020, the MFI has 72,000 active clients and operates 34 branches with a loan portfolio of KES 1.9 billion (USD 17.5 million) deployed for purchases of livestock, seeds, fertilizer, farming equipment, clean energy products and housing. Of these loans, which are offered in both group and individual formats, 58 percent are disbursed to women. Juhudi Kilimo’s investors are the Acumen Fund, the Grameen Foundation, Incofin CVSO and the Soros Economic Development Fund.

NMI was founded in 2008 with the goal of creating jobs and wealth via financial inclusion. The organization first launched the NMI Global Fund to invest in MFIs that are deemed “large and sustainable” as well as the NMI Frontier Fund to focus on sub-Saharan Africa and South Asia. In 2013, it initiated the NMI Fund III to invest in MFIs considered to be financially sustainable or likely to become so in the near future. Launched in 2019, NMI Fund IV supports financial service providers that supply “social loans (e.g. for education or housing), savings, micro-leasing, micro-insurance or payment services” in Africa and Asia. NMI’s funds hold aggregate assets of USD 370 million, with 19 active investments in equity and debt plus seven active investments in third-party funds. NMI is one-third owned by: (1) Norfund, which is backed by the government of Norway; (2) the Danish Investment Fund for Developing Countries, which is known by its Danish acronym IFU; and (3) a group of five private companies.

By Romil Pandey, Research Associate

Sources and Additional Resources

NMI press release
https://www.nmimicro.no/news/juhudi-serves-clients-remotely-during-covid/

Juhudi Kilimo homepage
https://juhudikilimo.com/

Past MicroCapital article on the usage of technology during the COVID-19 pandemic
https://www.microcapital.org/microcapital-brief-easy-microfinance-of-myanmar-offering-digital-loan-payments-agent-services-via-ongo/

NMI undated fact sheet
https://www.nmimicro.no/media/NMI%20Fact%20Sheet.pdf

Norad homepage
https://norad.no

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