Credit remains a matter of great importance in rural sectors of Kenya economy. Significant portion of the rural poor are unable to access funds.
Micro- credit business provides Revolving credit line, a flexible financial arrangement solution to micro-businesses to access funds at their discretion to meet their business needs.
The portfolio is designed for micro-businesses to buy inventory at critical time, manage employees payroll or pay the bills e.g. hospital bills, school fees, burial costs etc while waiting for payments to arrive from slow customers or business season to boom..
Micro-credit give customers advanced approval to borrow money as their need arises (within the line of credit agreement) without having to re-apply again. It is faster and more flexible and convenient.
To address challenges of lack of funds by micro-credit to deepen their outreach, Microfinance franchising model offers an opportunity to rural entrepreneurs using her institutional structures as possible solution for meeting credit demand.
The business involves allowing entrepreneurs to own branch outlet using company brand, IT systems, Portfolios and standardized processes under a special agency arrangement.
The concept provides insulation to the entrepreneur by providing a degree of stability, security and predictability that they wouldn’t rely achieve on their own.