Choice Microfinance has been licensed as a community microfinance bank (MFB) by the Central Bank of Kenya, allowing it to mobilise deposits in Kajiado North constituency.
The diaspora linked micro-lender becomes the eleventh MFB to be licensed in the country.
“Choice MFB's target market will be the pastoralist communities, flower farm workers and the micro, small and medium enterprises (MSMEs) resident and operating in Kajiado North Constituency,” said Central Bank of Kenya.
Marginalised communities and institutions, including pastoralist communities, represent a large percentage of the unbanked population in Kenya.
Central Bank has been pushing for financial inclusion which is seen as key in improving economic opportunities available to a community. Kenya’s financial inclusion is among the highest in Africa at 67 per cent, but some communities have been left behind.
As a community microfinance bank, choice will require a lower minimum capital of Sh20 million compared to Sh60 million required for MFBs conducting business across the country.
The institution has been mobilising cash from investors following conditional approval granted last year by CBK.
It was started by a group of Kenyans living in the US and seeks facilitate investment of diaspora funds into small and medium size enterprises (SMEs) in the marginalised areas of Kenya.
Diaspora remittances have risen significantly over the past few years to average over Sh10 billion monthly.