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GOING DOWN MEMORY LANE

Having joined Oikocredit in 2007, Caroline Kamau Mulwa gives the key highlights of this journey

By George Gichuki

Thirty years ago (1994), Oikocredit opened an office in Nairobi, Kenya. Caroline Kamau Mulwa, the Regional Director, Africa, joined the organization in 2007. Going down memory lane, Caroline says that at that time, the financial inclusion landscape in Kenya was entirely different from what it is today. “I remember attending the launch of the first FinAccess survey, which was one of my first networking engagements at Oikocredit,” she says. “As you can imagine, having come from the banking industry, the results were eye-opening to me. This was the first time that I was engaging with finance for good, and not just for profit,” she adds.

Going by those results, only 27% of the adult population had access to formal financial services, while 32% had access to informal financial services. Compared to the 2024 FinAccess survey, this situation has significantly improved. Currently, 85% of the adult population in Kenya have access to formal financial services. By the same token, 68% of the adult population has at least one savings or deposit account. “The advent of M-Pesa and other digital offerings have changed the landscape,” says Caroline.

The enactment of the Microfinance Act in 2007 is another milestone that she has experienced. It led to the licensing of the first microfinance bank, Faulu, in 2009. Since then, thirteen microfinance banks, under the supervision of the Central Bank of Kenya, have been launched. In the same vein, the credit reference bureau regulations were implemented in 2013. In 2020, these regulations were enhanced through the formalization of the credit information sharing mechanism, allowing data sharing with third-party credit providers. Come 2022, the digital credit providers regulations were issued.These developments affected microfinance institutions and banks who are partners of Oikocredit.

Growth

By and large, Oikocredit in Kenya has also grown in numerous ways in the last seventeen years that Caroline has served the organization. “When I joined Oikocredit, we had sixteen partners; majority of them were rural Saccos with poor governance and they had difficulty in repaying our loans,” she says. “At that time, we had a portfolio outstanding of EUR 4.7 million, but today, we lend this amount to a single borrower,” she adds.

In 2008, Oikocredit in Kenya re-examined its value proposition, developing a new market. To that end, it started working with microfinance institutions, who had varied clients and products, and a more developed governance system. “By 2009, our portfolio had doubled in size,” Caroline affirms. “Today, the Kenya office serves 1.30 million clients through its financial inclusion partners, while in Africa, we reach a total of 4.2 million end clients,” she adds.

In 2012, Oikocredit formally introduced the sustainable agriculture product, focusing on enterprises providing value addition and markets for smallholder farmers. Today, Agriculture forms 30% of the organization’s portfolio in Africa. “Through our agriculture partners, we reach 2.3 million smallholder farmers in Africa. Our partners have created 5,500 permanent jobs, and 55,000 temporary jobs across the continent,” she adds.

In 2014, Oikocredit initiated the renewable energy division, with a mission of reaching rural households and providing them with clean sources of energy. “We invest in companies that offer energy-saving cook stoves, pay-as-you-go solar home systems and solar mini grids,” observes Caroline. Globally, Oikocredit has reached 170,000 households with clean energy solutions, majority of which are in Africa.

In 2018, Oikocredit re-organized its business model, combining all its country operations in Tanzania, Uganda and Rwanda under the Kenya hub. This hub today serves fifty-seven partners in five countries, with a total portfolio of EUR 100 million.

Major Partners

All Africa Conference of Churches (AACC) was the first partner to get a loan from Oikocredit in 1994. Currently, it is servicing its sixth loan. Additionally, the first loan of UNAITAS (then known as Muramati Farmers’ Co-operative) was approved in May 1997. Currently, this Sacco is servicing its third loan. Currently servicing its sixth loan, the first loan of Sidian Bank (formerly K-Rep Bank) was approved in June 2005. Finally, the first loan of KWFT was approved in 2010, and currently, the lender is servicing its sixth loan. This is a testament to Oikocredit’s strong partnerships in sustainable financial inclusion.

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