Njeri Kaburu, the administrator for Burning Bush Inc.‘s microlending programs, recently sent a report summarizing all of BBI’s micro lending initiatives to various groups in and around Ndathi. The report did not include the support BBI has extended to cooperatives in the area, such as the Majuni Snowsnappers.
The first micro lending group was formed in 2007 by 28 women, who each received a cash loan of Kshs5000 (about $69) and a water tank. News of the group spread through the community, and four other groups of women requested funding for their projects. Burning Bush sent funds so that each of the women in those groups could also receive a loan of Kshs5000. Two of those groups dissolved the next year, after paying off their loans.
Throughout 2008, times were hard and there was much economic uncertainty in central Kenya. Njeri wrote, “We prayed that God would lead us and bring to us the women that he want[ed] us to serve and who need[ed] this money.” Their prayers were answered toward the end of the year when two other groups, one in Sagana and one in Mbiriri, requested funding. Three more groups received funding in 2009.
Today more than 260 women in the area are participating in micro lending groups. Most new participants have joined existing groups, rather than start a new group. The maximum size of any group is 60 members, and when a group reaches that size, it is usually split into two subgroups so that operations can be managed more effectively. At present, the two largest groups have 58 and 57 members, respectively.
After receiving and repaying initial loans of Kshs5000, some women have gone on to borrow larger sums. The most that has been lent to one individual is Kshs50,000 (about $685), and Njeri reports that the woman is repaying the loan faithfully. Others have borrowed anywhere from Kshs8,000 (about $110) to Kshs20,000 (about $275). The capital for the loans comes from Burning Bush’s initial grants, plus money the women are required to set aside to guarantee each other’s loans. In addition, the women are charged a fee of about one percent of the loan as insurance in the event of a member’s death, and these funds are added to the pool of money available for loans.
Since there has been such a demand for loans to cover school fees, the money Burning Bush has allocated for secondary students has become a revolving fund to provide short-term loans for school tuition. The loans will be made at the beginning of every school term and will be repaid in the second month, so that interest is due for only one month. The money is withdrawn over a period of four months, so it remains in the group for about five months.
Njeri writes, “Just yesterday a lady from one of the groups came by and as we were talking, she told me how they were discussing with other women that the Samaria group is going to help them pay for their children’s fees until they finish. This was a great confirmation for me. Please let [everyone] know that their good work will go a long way to touching many children in the Ndathi community.”