During today’s case study presentation on Water, Sanitation and Hygiene (WASH), Loise Mwangi of Kenya’s Sidian Bank shared her institution’s success in providing pandemic-relief loans for WASH equipment. Sidian lent about half of the funds, which total the equivalent of USD 4.7 million, to small and medium-sized WASH re-sellers, and the other half to community-based organizations, microenterprises and small and medium-sized enterprises (SMEs) using the equipment for their own operations, such as agribusiness, bottling and health care. As a whole, borrowers used about half of the funds for access to clean water and half for access to sanitation.
Each of the loans carries a term of two years, an upfront fee of 2 percent and an interest rate of 11 percent per year, subsidized by EUR 200,000 (USD 226,000) from Aqua for All. The loans ranged in size from USD 900 to USD 44,000 with a median size of roughly USD 4,400 and an average around USD 6,200. The program, which is ongoing, had reached 548 borrowers as of September. Ms Mwangi reports the portfolio at risk (PAR) ratio is zero.
For comparison, Sidian usually issues SMEs loans of around EUR 34,000 for terms of three to four years with PAR near 10 percent. The bank has 2,900 SME clients and an SME portfolio of EUR 98 million.
Sidian is working with Aqua for All on a possible extension of WASH lending in the amount of KES 100 million (USD 890,000). The organizations have also discussed partnering to monitor the impact of the program. Meanwhile, Sidian is considering expanding into loans for green energy and technology such as smart electric meters and online payments.
This feature is part of a sponsored series on European Microfinance Week 2021, which is taking place online through November 19. The event is held annually by the European Microfinance Platform (e-MFP). MicroCapital has been engaged to promote and report on the conference each year since 2012.
Additional Resources
European Microfinance Week 2021 agenda
https://registration.european-microfinance-week.eu/website/27793/agenda/
MicroCapital coverage of European Microfinance Week, including the European Microfinance Award
https://www.microcapital.org/category/european-microfinance-week/
Similar Posts:
- MICROFINANCE PAPER WRAP-UP: “A Brief Introduction to WASH for Impact Investors;” by Joana Afonso, Sachin Kumar, Alvaro Ma; Published by e-MFP, Aqua for All
- SPECIAL REPORT: Chamroeun Microfinance Scaling Up to Fund SMEs Supplying Piped Water in Cambodia
- SPECIAL REPORT: Yikri of Burkina Faso Wins $110k European Microfinance Award for Progress Toward Food Security #EMW2023
- MICROCAPITAL BRIEF: Incofin Launches Water Access Acceleration Fund (W2AF) with $39m to Invest in Africa, Asia
- MICROCAPITAL BRIEF: Abler Nordic Sells Equity Stake in Satin Creditcare, Provider of Microfinance to Low-income Women in India
