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Revolution in Kenya: Refocusing Microfinance on the World’s Poorest

By Tom Watson on October 17, 2007No Comment

Sam Daley-Harris looked up from the conference room table, and asked a tough question: “Isn’t she, in some respects, a revolutionary?”

The person in question was Ingrid Munro of the Kenyan microfinance agency Jamii Bora, which has grown from an informal collective of 50 street beggars into a trust serving 140,000 poor people in the African nation. Munro was in New York as part of a U.S. tour organized by Daley-Harris, the founder of RESULTS and its Microcredit Summit Campaign and a microfinance pioneer. Last week she spoke at a luncheon hosted by the Microfinance Club of New York, and she stopped by onPhilanthropy for an interview.

It was a big week for microfinance in New York, so Munro’s visit came at a time of increased attention to innovative financial solutions for entrepreneurs in developing nations. At the Harvard Club two days after our meeting, Daley-Harris was presented with the Susan M. Davis Lifetime Achievement Award by the Grameen Foundation during a luncheon that featured a talk by Muhammad Yunus, the Nobel Laureate and Grameen founder.

But Daley-Harris, praised for “making people feel bigger and more important than who they were” in the early days of microfinance, has another revolution in mind. Now that global lending institutions have discovered a profit center in microfinance, he worries quite loudly that some of the original intent of helping the poorest of the poor will be lost. Risk is moving microcredit away from those who can’t provide collateral and away from philanthropy entirely — which is why he was promoting Ingrid Munro’s story.

Jamii Bora (Swahili for “A Better Family”) makes loans to street people, specifically targeting thieves, beggars, prostitutes and the HIV-positive population of Kenya. Yet repayment rates are as high if not higher than some of the big lending programs, and the immediate benefits of lifting the destitute out of poverty are more apparent, said Munro, a soft-spoken woman who moved from her native Sweden to Kenya with her husband, a UN official, more than two decades ago.

Munro believes that organizations like Jamii Bora offer a “different way of measuring success. To us, the most important important number is how many people have been raised out of poverty.” And that’s the revolutionary side, said Daley-Harris, who believes the microfinance movement is at a critical juncture. Jamii Bora counters the idea “that microfinance can only assist the economically viable, that all microfinance must be profitable,” he said.

And Jamii Bora has big plans. Munro would like to reach half a million people in Kenya by 2009, or more than half of that nation’s poor. Her plan for growth was conceived in partnership with Unitus, a microfinance accelerator agency. She has installed a sophisticated hand-held tracking system that allows the agency, which often deals in cash, to track transactions wirelessly throughout its 60 branches. The Jamii Bora Trust also offers health and life insurance to HIV-positive clients, and partners with 41 hospitals for healthcare. It is also in the process of constructing an entire town called Kaputei near Nairobi that will allow its microcredit entrepreneurs to own their own homes for the equivalent of $20 per month.

Revolutionary, indeed. But 20 years ago, Yunus was also a revolutionary. On the day that Al Gore succeeded him as the reigning Peace Prize winner, Yunus discussed the power of the media and story-telling at the Grameen luncheon and recalled his first appearance on 60 Minutes. He also said that many American donors come to developing countries “with a very rigid attitude, they’re looking from the outside.” He talked about Grameen’s new partnerships in capital ventures with Dannon yogurt and Intel microchips, and declared: “I don’t think poverty has any place to hide any longer.”

In introducing Daley-Harris, Susan Davis (the outgoing chair of the foundation and president of BRAC USA) said he’d never “given up on the fight against injustice.” The same can be said about the other awardees at the luncheon, which was underwritten by Deutsche Bank: Grameen Koota of India (represented by Vinatha Reddy, its founder and CEO) and Amhara Credit and Saving Institution, represented by CEO Mekonnen Yelewemwessen.

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