Revolution underway as kiosk owners can now use purchase records for loans

The local duka/kiosk, which is a staple in almost every neighbourhood and village in Kenya is about to experience a transformation. Thanks to a partnership between Unilever, Mastercard and Kenya Commercial bank (KCB), Kiosk owners will now be able to stock their shops in reaction to demand and not according to how much they can afford to; as has been in the past.

Under the initiative dubbed #JazaDuka, distribution data from Unilever about the amount of stock a shopkeeper has been buying from them over time is analysed by Mastercard to determine whether the customers are eligible for credit. What this means is that if analysed data shows that a shop owner for instance, has been consistently buying weekly stock worth Ksh. 5,000, then they are advanced an interest-free loan of Ksh. 12,000.

This recommendation is forwarded to KCB who advance a line of credit to the kiosk owner through their mobile phones. The #JazaDuka initiative transforms the routine task of buying stock, into a credit scoring system that solves a major pain point for the Kiosk owner;  financial exclusion due to inaccessible credit that is often caused by lack of a credit history or collateral. So far, kiosks under the #JazaDuka initiative have increased their sale of Unilever products by up to 20 %.

“Financial inclusion is a key enabler of the 2030 Sustainable Development Goals – lifting individuals out of poverty and supporting overall economic growth. By broadening our collaboration with Mastercard, working across sectors and including additional private and public partners, we are further expanding the positive impact of financial and economic inclusion” said Paul Polman, Chief Executive, Unilever.

The pilot phase of the programme is being run in Nairobi where 5,000 shop owners have applied and are to be fully enrolled by mid-May. The initiative aims to sign up 20,000 kiosks by the end of 2018 and further expand to the rest of Africa and Asia-Pacific. In addition to the credit line, the partnering companies are providing training on finance, inventory management, marketing and planning for supply against expected future demand.

Commenting on the initiative KCB Group CEO and MD Joshua Oigara said, “We see this partnership as a big plus in boosting our role as catalysts of trade and doing business in East Africa.” While Ajay Banga, President and CEO Mastercard termed it as an opportunity to facilitate long-term growth for the businesses using inter-industry data to revolutionise business financing.



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