Thousands cash in on newly launched credit institution

Henry Rithaa, the Managaing Director of the Meru Micro-finance Corporation. PHOTOS: PETER MUTHOMI/STANDARD

Dickson Muriungi has been buying poultry at Marimanti in Tharaka Nithi and selling them at Mitunguu and Nkubu areas in Meru County for the last two months.

On each trip, he usually purchases not more than 10 hens or cockerels at Sh300 each.  Mr Muriungi then sells each bird at Sh500, earning Sh2,000 in profit.

When he needed to buy more poultry to maximise profits, he applied for a Sh5,000 loan from the Meru Micro-finance Corporation (MMC), unveiled by Meru Governor Peter Munya’s administration three months ago. It kicked-off with a capital of Sh50 million, with Mr Munya saying that amount will be pushed to Sh100 million in the next financial year.

In the three months it has been in existence, the MMC, which has two branches in Meru and Maua towns, has targeted individuals and small and medium-sized enterprises. Members are trained on finance management, then advanced loans to expand their businesses.

Henry Rithaa, the Managing Director of MMC, said the aim is to assist micro-entrepreneurs access finance for working capital. “Our target is to reach out to and assist small business operators, including mama mbogas, boda boda operators, farmers, shopkeepers and others,” Mr Rithaa said. He said they offer different products to assist people in various lines of enterprise.

For one to be a beneficiary of MMC, one first has to be registered as a member. So far MMC has about 20,000 members from the nine sub-counties, who are currently being trained to enhance their business skills.

“The MMC was created through an Act of Parliament and we have been in operation since January 15, 2016. The idea was to establish a micro-finance that would become a real game-changer for small business people,” Rithaa said.

He said one of their products, Mali Yangu, is a game-changer. “It is an asset financing product aimed at enabling micro-entrepreneurs acquire business assets such as equipment and machinery. It is eligible for all members, and has flexible repayment options, including by mobile money account.

To qualify for the product, members have to be in a group of between eight to 10 people. Another product is Kilimo Bora, aimed at enabling small scale farmers acquire farm inputs for increased productivity.

Individual farmers can access farm inputs through group guarantee. “We want to help the small farmer. That is why we allow the borrower to pay directly from the sale of product sold in the local market,” he said.

For the youths, there is Pambazuka, which gives them working capital. To qualify for the loan,  they must belong to a group registered with MMC. “We also advance loans to livestock and chicken farmers. We give them emergency loans to buy the livestock and chicken, and they pay up immediately after selling them. It is meant to protect them from shylocks,” Rithaa said.