Many people seem not to understand the meaning of the term microfinance. To some, it is the same as Small Medium Enterprise (SME) while to some, it is the art of lending out small amounts of money who have or no credit at all.
Also known as microcredit, microfinance is a financial service that offers loans, savings as well as insurance to entrepreneurs and small business owners who don’t have access to traditional sources of capital.
The traditional goal of micro-financing is to provide individuals with the much-needed cash to invest in themselves and their businesses.
For many years, the unemployed and the low-income individuals in Kenya have been deprived of the opportunity to invest and start their own businesses. This is because of the time, a majority of them do not have finances to kick-start their businesses. All such individuals need is a little financial help but they always don’t qualify for a standard bank loan.
Stats show that 80 percent of businesses in Kenya are SMEs. Unfortunately, more than 400,000 SMEs die annually in Kenya due to lack of finances as well as the tough economic environment. The saddest thing is that majority of the dying SMEs, die in their first year of establishment.
SMEs and entrepreneurs in Kenya need someone to hold their hand, someone who is ready to start with them from nothing to realizing something. The coming of Rafiki Microfinance Bank was a breakthrough in helping to revive and develop the microfinance sector in Kenya.
Rafiki, a Swahili word that means ‘Friend’ has been on the forefront in pushing the agenda of financial inclusion through entrepreneurship development. Fully licensed and regulated by the Central Bank of Kenya, Rafiki is the 3rd largest microfinance institution in Kenya. The bank has 19 branches spread across 11 counties in Kenya.
With 19 Rafiki branches across 11counties and specific partnerships with Kilifi, Makueni and Kiambu for financial intermediation, the Rafiki has a significant impact in regional and national economic development.
This is a series of a journey through Rafiki Microfinance Bank. Watch out for the various products and services offered by Rafiki Microfinance Bank.