Nothing has made me prouder of our work with Jitegemee than seeing the success of the microfinance pilot project. This year, after much planning and research, Jitegemee finally ushered in the final phase of its vocational program: loaning small amounts of money to young people who have mastered their vocational trades.
During my trip to Kenya, nearly every Jitegemee graduate who took a loan reported significant increases in their monthly earnings. John Maingi Nzau, a freelance electronics repairman, used his loan to buy a tool he needed to repair large radio speakers. Now he estimates that he earns about $65 per monthâ€”about 30% more than he did before the loan. Michael Wambua Musau, a 20- year-old carpenter, bought wood with his loan. Since he works on a commission basis when he uses his employerâ€™s wood, the loan allowed him to be paid 100% on certain jobs. That has boosted his salary by 25%, he estimates, to about $40 per month. Christopher Munyao Mumo, a 23-year-old self-employed welder, also bought raw materials with his loan. He estimates that his earnings increased by 50% to about $120 per month.
In Machakosâ€” where entry-level elementary school teachers might earn about $150 per monthâ€”these salaries speak to the considerable financial success that Jitegemeeâ€™s vocational graduates have achieved.
These salaries contribute not only to the well-being of these youths, but also their families. Michael Musau, an orphan who once came barefoot to class at Jitegemee, is the sole breadwinner of the home where he lives with his grandmother. Christopher Mumo, who used to earn money fetching water as a teenager, has now amassed a bank account with $300 in savings from his own welding business and is currently paying for his little sisterâ€™s dressmaking classes as well as contributing to the food and upkeep of his other siblings.
To repay their loans, these vocational graduates formed their own self-help society that meets every Wednesday to support one another, financially and emotionally. Every week, each member contributes $5, half of which goes to Jitegemee toward repayment of their loans, and the other half of which is put in a communal pot. Each week, the members vote on who should get the pot. Whoever receives the pot gets a windfall of new capital for their emerging businesses.
The group provides an important financial safety net. When a member is unable to repay the loan that week, other members contribute to cover it and are refunded later.
Seeing this group of former street children become skilled craftsmen and entrepreneurs has been among the most exciting and gratifying experiences of my life. But few could explain what these young people have achieved better than Felistus Mumbu Mutua, a 20- year-old hairdresser who was elected chairwoman of the vocational studentsâ€™ solidarity group.
Felistus earns about $80 per month through commissions. She used her $60 loan to buy hair products, because she earns a higher commission when she uses her own products. Here is what she had to say about the experience:
Â Q: How does your microfinance self-help group work?
A: Our group is seven weeks old. We meet on Wednesdays. We take tea together. Sometimes there comes a time when you donâ€™t have any money to repay the loan. So other people in the group contribute and the next week, you refund the money.
Q: What is your biggest challenge?
A: Sometimes people donâ€™t come for meetings and they donâ€™t send apologies, so I am forced to go out looking for them. When I find them, we negotiate and they pay their share.
Q: How do you feel about having a bank account?
A: I feel good. I have been able to save a lot. I was the first person in my family to open a bank account. Now, I am encouraging my sister.
Q: What are your personal goals?
A: I want to have my own salon. I thought I would have my own salon by now, but it has taken me longer to save what I need. I have to provide a lot in my family and pay secondary school fees for my sister, so it has taken me more time.
Q: Why were you chosen as chairlady?
A: Sometimes I am tough. I take things seriously. No joking around.
By Farah Stockman
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