What I'm working on in Africa (Kevin Edition)

I’m working with Juhudi Kilimo, which is a small microfinance institution. What they do differently than other places is:

  • They give out assets, not cash.
  • They focus on rural areas. (Most MFIs focus on urban or at least in-a-small-city areas.)
  • They focus on agriculture.
  • The loans are for a “business in a box” designed to start generating cash immediately.

In short, this usually translates to people taking out a loan, and receiving a dairy cow, along with business guidance on how to farm the cow, where to sell the milk, and so on. Microfinance is based around the idea of group lending, which means that a group of people get together and guarantee as a group to repay the loan of any individual, thus reducing the risk of the loan and providing social pressure for group members to repay. Our lending groups each focus on a single type of farming (like dairy), so that everyone in the group learns more about farming from each other. Because of our asset-based nature, when loans go south and someone defaults, the situation for Juhudi and the client is overall much better, since the cow can be repossessed, rather than having to take the group’s savings or repossess someone’s home. (In fact, when we do have to collect, we usually end up giving the client money, because the sale of the cow often covers more than the remaining balance.) And Juhudi’s rural aspect means that we’re helping some of the poorest people with the fewest opportunities, and thus helping to prevent migration from the countryside into the city’s slums, which generally helps no-one.


Izika, a coworker of mine, tagging a cow during a trip to one of our field offices. I did not tag any cows.

What I’m doing: I’m building a system for the loan officers in the field to use, to help make them more efficient at their job, and able to manage more loans. Currently, the loan officers maintain everything on paper, with a handwritten ledger. That means when it’s time to attend a group meeting, the officer has to go through the financial records of 20 to 30 clients, and sum up how much savings they each have, calculate who owes a loan payment, and for how much. The loan officers do all this paperwork, even though the computer in the head office has all of this loan, client, and repayment information in a database. Since a typical loan officer attends 40 or more group meetings a month, this work really starts to add up.

To help address this, I’m building an Android application that can hold all of the client information that a loan officer needs, that synchronizes automatically over the Internet. The application runs on a sub-$100 Ideos phone, and to save costs, holds all the information offline, so that no connectivity is needed to look up a client’s balance or a group’s repayment schedule. The goal of the application is to ultimately make it so that the loan officer does not need to record anything on paper, by giving them current information on all their ~300-600 clients, automatically updated each morning.

The long term goal of the system is to make a loan officer’s job easier, so that they can handle an increased number of clients. The cost of loan officers’ salaries is usually is the largest operating expense of a microfinance institution. If you can allow an officer to handle twice the number of clients, you can cut operational costs significantly, reducing the operating expense ratio— and a low operating expense ratio is usually the most important factor in getting increased investment from external sources.

My hope for the system is that in the average case, it will help Juhudi scale as an organization, allowing them to grow to 2 to 4 times as large in the next year or two, and thus be able to help that many more people. In the best case, though, I hope that this system can have a much larger impact. The application is open source, and it is free for any microfinance institution to use. I’ve designed the system it so that it’s easy to adapt to any institution: just plug a few SQL queries into the configuration file, run it on a computer in your office, and you should be good to go. Any loan officer can then start using it immediately.

It also feels good to be able to help the kind, smart people I’ve met who are out there working hard every day to help Kenya’s poor, but who are doing it without any of the technology that the rest of us take for granted. Everyone should get a chance to use technology to make their lives easier—not just those who work in the wealthiest industries or countries. I mean, imagine if I told you that tomorrow, you are going to have to head out into the countryside, and manage the savings accounts and loans of 600 people, spread across 40 groups, armed only with a pencil, a notebook, and a calculator?

But a picture is worth a thousand words (and is usually a lot more fun). So, here’s some screen shots of the application in action:


When you first install the application, it asks you to select a loan officer. It then synchronizes all the data for that officer from the Internet.


Next, once an officer is synchronized, you select the officer and lending group that you’d like to work with.


In the application’s main screen, you can see the collection sheet, which tells you how much each client should pay that month, as well as the receipt view, which shows how much you collected from the group treasurer last month.


Finally, the client detail view allows you to see the active and completed loans for each client, as well as the transaction history of each deposit and withdrawal.

If you’d like to read a little more about Juhudi and understand how we’re helping people in Kenya, you can check out this recent journal entry from Jacqueline Novogratz, the CEO of Acumen Fund and the author of The Blue Sweater, who visited our Kitale office last month. (The part about Juhudi starts on Page 9.)