A Unique Bank
K-Rep Bank Limited is the first and only commercial bank in Kenya 
that
caters specifically for the low-income people. The Bank was established
and geared to provide to provide microfinance services (loans, savings
and banking services) to low-income/poor entrepreneurs and households that
have no access to mainstream banks and financial institutions. The
bank has over 21 outlets through out the republic of Kenya.
What distinguishes K-Rep Bank from other commercial banks is its
social objective of serving the poor. It aims at demonstrating that the
poor are bankable and that providing financial services to low-income people
can be done on a commercial viable basis. The bank offers a wide range
of banking services.
History
K-Rep Bank is the brainchild of K-Rep Group. It traces its roots to
experimen with direct/ retail lending to the community based enterprises
and wholesale lending to other non governmental organizations. Experiences
gained over the years supplemented with a study and an exposure visit to
the Grameen Bank in Bangladesh , Latin America, India and other countries
led to the development of K-Rep's first loan product ‘JUHUDI’ a Kiswahili
term meaning determination.
This was closely followed by the introduction of another loan product
‘CHIKOLA’ a term borrowed from one of the local language meaning merry-go-round
in 1991. Direct lending practices and good performance of the operations
were the real force behind the establishment of the Bank. The experience
unveiled the potential to expand and deepen outreach to low-income clients
on a commercially viable basis. After considering the limitations
of operating as an NGO that is sustained by donor funding, K-Rep opted
to establish microfinance bank.
Why a bank?
-
Securing a more appropriate & sustainable funding source from the financial
markets and financial independence.
-
Acquire a more appropriate institutional form and long-term institutional
base, as well an appropriate corporate culture for providing financial
services.
-
Influencing policy & the finance sector, in favor of serving low-income
& poor people.· Gaining recognition & legitimacy as a financial
institution.
-
Establish a stronger base for ownership, governance and management.
-
Commercialize & integrate microfinance into the mainstream financial
markets and to situate microfinance amongst legitimate financial institutions.
-
Encourage entry of other players, from the financial markets, in order
to expand outreach.
-
Improve governance, management & transparency, through ownership &
capitalization.
Our aims, philosophy and Belief
K-Rep bank aims at bringing micro finance to the center of the financial
markets arena, as opposed to the peripheral financial activity it has hitherto
been perceived to be. It seeks to demonstrate that lending and providing
banking services to low-income or poor people, is both commercially viable
and an important development intervention for poverty eradication.
The bank’s core business is to serve low-income people, especially those
operating very small and micro enterprises, as a means of facilitating
their participation in the economic development of this country.
K-Rep believes that an institutionalized access to financial services enables
poor people to better organize their financial lives and enhance their
chances to propel themselves from the poverty cycle.
Poor people are not sedentary and do not need handouts. What they
need is access to appropriately delivered financial services. It
also believes that the Jua Kali – small – micro-enterprise sector is a
crucial part of the Kenyan economy and deserves the support of the banks
and the financial sector.
Shareholders of the bank
Shareholders |
Shareholding
% |
| K-Rep Group Limited |
25.0 |
| ShoreCap International |
8.2 |
| KWA (ESOP) |
10.0 |
| International Finance Corporation |
16.7 |
| The African Development Bank |
15.1 |
| Triodos |
11.0 |
| Founding Members |
5.2 |
| Centum Investment Company Limited |
3.8 |
| Netherlands Development Finance Company (FMO) |
5.0 |
| |
100.0 |
|
Governance
The bank has separate board of directors drawn from the shareholders
shown above. The current Directors of the bank are:
-
Bethuel Kiplaga t:- Chairman; K-Rep Group Limited
-
Kimanthi Mutua :- Managing Director of K-Rep Bank
-
Marilou Van Golstein
- Mary Houghton :- Shorebank Corporation
- Frank Streppel - Triodos Bank N.V
- Eme Essien:- International Finance Corporation (IFC), a member of the
World Bank Group.
- Sheku Sesay:- The African Development Bank (ADB).
- Tony Wainaina
Products & Services
Juhudi Loan Product
‘Juhudi’ is a Kiswahili term meaning determination and it was the first
loan product developed by K-Rep. It is fashioned after the group
lending methodology of the Grameen Bank in Bangladesh but customized to
fit the Kenyan society. The purpose was to cover the loopholes of
the then existing lending methodology by broadening outreach, ensuring
self-sustainability and ensuring credibility and professionalism in the
delivery of credit to the SMEs.
Salient Features of Juhudi
Members join in-groups of five called watano.
Six groups are federated into a big group of 30 members called a kiwa.
Compulsory weekly group meetings.
A rigorous Kiwa orientation and training for 8 weeks on loan management.
Weekly collective savings by members into a pool.
Amount of loan disbursed is a certain proportion of the individually saved
amounts with the proportion of savings required increasing with loan amounts.
Loans disbursed to individuals in the ratio of 2:2:1 within a watano and
12:12:6 in a Kiwa.
A fixed maximum amount of first loan that can be borrowed.
Group co-gurantee mechanism.
In addition to group savings, pledged household assets act as loan security.
Weekly loan repayments.
Loan duration is between six months to one year.
Forfeiture of all savings inclusive of interest earned by a member in case
of default. If insufficient, the watano group that the borrower belongs
forfeits an equivalent amount of their savings. If it is still insufficient,
the member’s pledged items are sold.
Chikola Loan Product
Chikola is the second loan product of the K-Rep Bank way back in 1991
and it is a term from a local dialect of the Giriama people meaning merry-go-round.
It blends the concept of lending methodology of the indigenous rotating
savings and credit clubs with that of the Grameen Bank. Chikola is
popular in areas with groups whose objectives rotate around economic and
business issues rather than welfare activities.
The Salient Features of Chikola Scheme
Only pre existing groups with a membership of 20 are legible.
Groups must be at least 1 year old.
Members must be operating small to micro enterprises.
Monthly group meetings.
Group must operate a joint bank account with a minimum balance equivalent
to 10% of loan amount to be borrowed.
Money is lent to individual members.
Group is collectively responsible over the performance and repayment of
the loan.
Monthly loan repayment.
Loan duration is one year and over.
Kati- Kati Loan Product
The third and largest loan developed by K-Rep Bank in the year 2000.
Kati-kati is a Kiswahili term meaning moderate. Therefore it meant
to cater for financial needs of between Kshs. 100,000/= to Kshs. 250,000/=
as a first loan with K-Rep Bank which is in essence moderate financial
needs. It is neither meager nor large. It is open to the public
at large.
Salient Features of the Kati-Kati Loan
Product
Must operate a small enterprise.
Must be willing to open a K-Rep Bank account.
Must register a group of between 5 and 10 members with a common need from
one locality.
Ready to attend weekly meetings and thereafter monthly.
Must be willing to co-gurantee each other.
Willing to contribute regular savings to the group account.
Must raise cash collateral.
Must provide sufficient security.
Loan Services
Loan products are categorized into two:-
Savings Services
Savings Account
Deposit accounts earning competitive rates of interest
Features and Benefits
- Minimum opening amount of Ksh.500
- Attractive interest rate
- Free yearly statement
- No ledger fees
- ATM Services available
Requirements
- Two coloured passport size photographs
- A copy of your national identity card (ID) plus original for verification
YES! Saving Products
YES! Msingi Account
Children’s savings account with attractive interest rates, school fees loan and other benefits.
Features & Benefits
- Minimum opening amount of Ksh. 300
- No ledger fees/account maintenance charges
- Issuance of ATM card
- Access to school fees loan
Requirements
- Copy of birth certificate or hospital immunization card
- Two passport size photographs of parents/guardian
- ID/Passport copy of the parents/guardian
YES! Mshahara Account
Mshahara account is a saving account for individuals who receive salary on regular payments from their employers or any other source.
Features & Benefits
- Minimum opening amount of Ksh.300
- No monthly ledger fees
- Issuance of ATM card
- Free quarterly statements
- Minimal monthly salary processing fee
Requirements
- Two coloured passport size photographs
- A copy of your national identity card (ID) plus original for verification
- Introduction letter from employer
- Copy of Pin Certificate
YES! Youth Account
This is a savings account for the youth where they can save for the future and borrow loans for programmes of their choice.
Features & Benefits
- Minimum opening amount of Ksh.300
- No ledger fees/account maintenance charges
- Issuance of ATM card
- Free quarterly statements
- Attractive interests
- Personal/Business loans
Requirements
