Microlending Procedures

Posted on Oct 30, 2008

Burning Bush, Inc. has expanded its outreach in Central Kenya to include microlending initiatives. A total of seven new microlending projects were launched in 2007, including the Ndathi Dairy Cooperative, the SnowSnappers Farming Cooperative, the Ushindi Knitting Group, and the Merry-Go-Round Group.

BBI has put a process in place to ensure that all microlending projects are properly organized. A group begins by meeting together for a period of at least six months to discuss an opportunity and determine if they want to move forward. Each member contributes the equivalent of one dollar at each meeting. When sufficient funds are accumulated, a member of the cooperative can borrow money to purchase household supplies or the group can vote to acquire items in bulk for members to divide among themselves.

Members continue to meet once a month. The group then applies to the Ministry of Cultural Affairs for registration. Once registered, the group sends a proposal to BBI requesting funding, usually in the amount of $2500, which BBI wires to the cooperative’s checking account. Each member may then borrow money to make a purchase (a chicken, goat, seeds, fertilizer, etc.) or to pay for immediate needs, often to pay for a child’s school tuition, books, or uniform. This loan is repaid to the group over time, usually at an interest rate of 10 percent. The cooperative holds each member accountable for the terms of the loan. The start-up money is never returned to BBI, and there are no strings attached by BBI for its use. The cooperative makes its own rules. The pictures to the right show some of the hardworking groups BBI has helped.