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SMEP: Micro lenders changing Kenyans lifestyles

SMEP Micro Finance Bank is regarded as Kenya’s oldest micro-lending institution, and has been in operations to the 1970s.
The microfinance bank started out as small scale business and charity enterprise under the auspices of the National Council of Churches of Kenya [NCCK] way back during mid 1970s. According to SMEP’s CEO Symon Kamore Mwangi, “our goal then was to provide holistic support to families and assist in feeding children of commercial sex workers, with a view to not only transform their lives but those of their dependants as well”. In the long run, the initiative also sought to assist these families and enable them restore their sense of dignity in society. The beneficiaries were granted credit schemes revolving around making profit from their daily budgets, whereby they were given basic guidelines on buying products, which could then be resold for profit. This model was initially supported by numerous donor organizations. It then evolved over the years, leading up to SMEP’s gradual growth into a commercial entity and microfinance institution limited by guarantee. Subsequently, on the basis of these noble ideals, the institution blossomed and was formally registered as a Small/ Micro Finance Company during 1998. “This was the foundation of the banking institution we are today with an asset base currently pegged at an estimated Kshs. 1.8 billion. But our target is to surpass that figure to over Kshs. 2 billion by the end of this year,” notes the CEO. “We have set up fully functional banking hall services in 17 branches and in 35 regions we offer basic non-banking transactions. In those areas we are yet to set up base, our customers are served through mobile banking services, 3rd party agencies or partner banks,” says Mr. Mwangi. SMEP was the third institution to
institute banking operations after Kenya Women Finance Trust [KWFT] and Faulu in 2010. In essence however, their core objectives have not changed much from the initial ideals but the scope of services and operational capacity has grown.
“As a homegrown entity and fullyfledged banking outfit, we are proud to
have so far sustained and upheld our pioneers noble vision to assist the most needy in society,” remarks Mr. Mwangi. The range of products on offer at the Micro finance institution is now much broader in scope and in tandem with the evolving economic and micro-lending dynamics.
“We are now able for instance, to address myriad emergent business interests cutting across consumer demands. At the onset we were not licensed as a bank hence there was no need for saving accounts. But now we have the capacity to mobilize varied financial transactions,” notes the CEO.

SMEP also took advantage of the mainstream banks lapse not to invest or tap into the vast potential abound in micro-finance products. All that was required to capitalize on these loopholes was to expand and fully upgrade on the institution’s infrastructural capacity.
“We ensured that our packages were attractive to especially chama’s and selfhelp groups, adopting aspects of the Grameen model, which seeks to build upon the poor-focused empowerment of the unbanked people from the grassroots level,” remarks Mr Mwangi. This globally widespread model entails having credit lending packages that
encourage individuals who are keen to
pool their resources, come together to
engage in collective investment.
Unquestionably, the bank’s greatest achievement lies in the provision
of transparent transactions – with
their loan terms being especially well
thought out, clearly articulated and
written in simple communication.
“As a bank, we have purposed to
ensure that there are no hidden clauses
or concealed information in small print.
We seek to ensure our clientele make
informed decisions before appending
their signatures on any agreement,
whether short or long-term transactions
– this is one of our standout factors,”
asserts Mr Mwangi.

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