Musoni Microfinance

Mastercard eases small retailers’ access to loans

Mastercard has unveiled a digital ordering system for small kiosk owners, which also creates a digital record for them to qualify for micro-loans for business expansion.

Kionect allows Nairobi shopkeepers pay and order for products, providing a digital log of transaction data.

For every loan paid on time, the shopkeeper qualifies to take out a larger loan for a longer term which in turn contributes to the growth of their business.

The system is currently being piloted with over 1,000 micro-businesses in Kibera, Kawangware and Kariobangi, in partnership with for-profit wholesaler and distributor Kaskazi.

The digital log created is what will be used to qualify the micro-retailers for loans from micro-finance provider Musoni.

“This Mastercard technology opens up a new avenue for micro-retailers to grow their business, increase consumer demand and ultimately contribute to economic development in Africa,” said Michael Elliott, vice- president Mastercard Labs for Financial Inclusion in Nairobi.

He said developing Kionect was inspired by observations made on hurdles faced by small retailers in sourcing, tracking inventory and access to flexible, short-term credit.

Diamond Trust Bank (DTB) is facilitating digital payments between the kiosk owners and the wholesaler, and is also acting as a re-seller of the platform to its wholesale business clients.

Kionect joins the likes of Maisha Meds and Twiga Foods in making it easier for retailers to access products from the wholesalers.

Maisha Meds is an automated reordering tool that integrates price lists from a range of high quality suppliers in Kenya to determine best medication price.

It uses the data to determine the optimal quantity of medications to purchase based on prior sales data, and places orders directly with suppliers.

Twiga Foods, on the other hand, is a mobile-based supply platform that saves mama-mbogas (vendors) the trouble of waking up at dawn to go to the wholesale market for supplies.

It picks supplies from farmers and delivers it to vendors in several estates in Nairobi using tuk-tuks (three-wheeler taxis), vans and canters.

Adapted from: Business Daily Africa

© 2022 Musoni Microfinance Ltd.