Social impact first!

Social impact first!: Challenge the image of the poor.

Iringa, Mafinga, TanzaniaToronto, Canada
Year Founded:
2012
Organization type: 
hybrid
Project Stage:
Established
Budget: 
$10,000 - $50,000
Project Summary
Elevator Pitch

Concise Summary: Help us pitch this solution! Provide an explanation within 3-4 short sentences.

KickLoans provides financial solutions (business training, microloans and savings) to the poorest of the poor. Our video-only microfinance platform enables the global community to directly loan and empower low-income individuals in Africa.

WHAT IF - Inspiration: Write one sentence that describes a way that your project dares to ask, "WHAT IF?"

What if 2.5 billion people living on less than $2/day can take charge of their own life.
About Project

Problem: What problem is this project trying to address?

In Tanzania over 80% of Tanzania’s working population has no access to mainstream banking services. In an attempt to address this, many banks and organizations have begun targeting the poor by extending collateral-free and low interest microloans. Due to lack of skills and experience within the market these efforts don't reap the expected results and do more damage than good.

Solution: What is the proposed solution? Please be specific!

Our solution is 3 dimensional: 1) Financial education and business training to equip low-income individuals with the right skills to expand their businesses. For example they must know how to sell their products, how to attract customers, how to sustain their businesses, how to leverage technology (mobile banking), how to save money (...). 2) Microloans so that they can invest in themselves. 3) Microsavings to prepare for a much better future.
Impact: How does it Work

Example: Walk us through a specific example(s) of how this solution makes a difference; include its primary activities.

Anna Grace Batarazy is one of the borrowers who took part of our pilot project. She came to us asking for a $250 loan. Soon after receiving the loan, she bought inventory, started spreading the word about the "new" varieties of product she now offers and pretty soon her database customers increased. People who used to walk over one hour to get food from the market where now spending less than 10mn to get food. Her income dramatically improved and she was able for the first time to pay her kids' tuition fees in full, she opened a savings account for the education of her kids and was able to buy a health insurance for the whole year. She was able to impact not only her community but also her family! Now take her story and multiply it.

Impact: What is the impact of the work to date? Also describe the projected future impact for the coming years.

Before the pilot project, the average salary of a microbusiness owner was $1.6/day, in some cases it increased above the poverty line. These micro-entrepreneurs used the proceeds of their businesses to send their children in school, provide their families with better health and nutrition. The ones who have successfully completed the pilot project have not requested additional financing thus demonstrating their businesses are sustainable. In addition, through our entrepreneur guidance, the participants of our pilot project created within 11 months a marketplace for all their products and services. Now the entire community benefits for not having to travel long distances for the food and supply they need. In April 2014, we expanded to Mafinga (rural area) in order to reach the poorest of the poor, where we currently work with over 150 low-income individuals.

Spread Strategies: Moving forward, what are the main strategies for scaling impact?

Achieving social impact using a tool such as Microfinance requires time, passion and commitment. The pilot project conducted in April 2013 revealed to us shocking and unexpected facts such as high repayment rates and social impact are NOT correlated, or what works for one entrepreneur may not work for another entrepreneur. This lead us to adopt a 3 dimensional solution in March 2014: 1) Tailored business training 2) Microloans 3) Microsavings Moving forward, the strategy is to work hand in hand with the people we serve and make sure they are included along the way.
Sustainability

Financial Sustainability Plan: What is this solution’s plan to ensure financial sustainability?

Our revenue streams are: - Interests on loans. We charge a transparent 2% monthly interest rate on a declining balance which result to an annual percentage rate (APR) of 24%. - Donations made by the global community in the online platform during the process of lending. - Interests made on deposits. - Future revenue streams: we plan on starting many local businesses in the area which will drive more revenue.

Marketplace: Who else is addressing the problem outlined here? How does the proposed project differ from these approaches?

Poverty is addressed by NGOs, bilateral development agencies and banks such as Equity Tanzania, SELFINA, AccessBank TZA (...). Their strategies have proven its inefficiency and lack of transparency as they weren't able to demonstrate the social impact of their programs. We empower the poor by focusing on business skills which is a crucial factor to eliminating poverty. We also teach them how to save money so that they don't depend on exterior financial support. In addition, we follow their journeys on camera and make them available on our website, hence drastically increasing transparency!
Team

Founding Story

Africa = poverty, hunger, conflict, disease, aid. As long as we perceive the poor as recipients of aid, we will struggle our way to fulfill our mission to eradicate poverty. Stephanie Mbida launched KickLoans in 2013 after realizing that the narrative of her continent didn’t quite fit the reality. Her early exposure to entrepreneurship at age 9 lead the young entrepreneur to introduce a solution based on entrepreneurship and financial inclusion and therefore deconstruct the perception of the poor in third world countries. With KickLoans, the equation takes another meaning and translate to Africa = strength, work ethic, hope and opportunities.

Team

1) Stephanie Mbida: Founder and Executive Director. She wears many hats within the organization. She works full-time. 2) Tim Roberts: Communications Director. He builds relationships and manages KickLoans’ partners. He is part time. 3) Fadhila Simon Kihwele: Project Manager in Tanzania. She oversees all activities in the field. She is full time. 4) David Edward: Multimedia coordinator working in Tanzania. He works part time.
About You
Organization:
KickLoans
About You
First Name

Stephanie

Last Name

Mbida

About Your Project
Organization Name

KickLoans

How long has your organization been operating?

Project
Organization Country

, ON, Toronto

Country where this project is creating social impact

, Iringa, Mafinga

What awards or honors has the project received?
Funding: How is your project financial supported?

Friends and family, Individuals, Foundations, Businesses, Regional government, National government, Other.

Supplemental
Sector

Opportunities for Women.

Audience: Who have you identified as your customer/recipient groups and do these groups value your solution for different reasons? How do you engage different customer/recipient groups to deliver your solution?

Our customers are primary women living under $2.5/day. In Tanzania over 80% of the population has no access to mainstream banking services. Out of this 80%, 69% are women. The demand is very high, so is the potential to help them defeat poverty themselves. The word of mouth and the reputation of our organization do all the work for us.

Scaling the solution: How would the prize money and publicity help you to achieve your objectives over the next two years?

Our objectives over the next two years are to:
1) Impact 1000 low-income women in rural areas of Tanzania.
2) Have a sustainable social business to unable us to impact even more women long term.

All the borrowers are trained and ready to receive funding (the prize money). This will enable us to provide capital to 200 women, hence enabling us to reach 20% of our goal to impact 1000 women.
Publicity will exponentially drive traffic to our website - where they are many borrowers awaiting for funding - which will engage the global community and lead them to directly loan to the working poor on the online platform.
This will ultimately enable us to drive income through donations, interests made on loans and deposits.

Experience: Please provide examples of any previous entrepreneurial initiatives you have pioneered

I started my first business at a very young age - Age 9 - and have under my belt many success and failures I learned from. I acquired at a young age skills and successful habits that most adults don't have. I possess the required skills and mindset to successfully lead this program. On April 2014 for example, I initiated the first-ever #MicrofinanceChat on twitter which reached over 1 million accounts on twitter in less than 3 months.

Are you are eligible to attend the Accelerator event in Cambridge and subsequent events in London, UK in January, 2015?

yes

Will you require a visa to enter the UK?

Are you are a current Unilever employee?

Comments

Microfinance schemes have demonstrated huge impact and I hope this scheme succeeds. The budget seems low for the startup stage, as provision must be made to encourage people to join the scheme and provide the training (through video) that is needed for this scheme to succeed where others have failed.