Making a Difference in Microfinance

It is often said that if more women are empowered with financial assistance in the poorest and remotest areas of the world it would have a huge significance in the uplifting of living conditions for women, men and children alike.

Mobile Transactions is working with Vision Fund Zambia, commonly known as “Harmos”, a wholly owned subsidiary of World Vision International. Vision Fund has a Mission to economically empower the poor to improve their livelihood and become productive members and advocates for positive change in the society, through sustainable microfinance services such as business loans, agriculture loans, bicycle loans and youth loans.

My name is Brenner Nkunta; I am currently as the acting Vision Fund Account Manager (our regular manager is on maternity leave – congratulations!!!). I am the link between the Vision Fund head office in Lusaka, the Mobile Transactions Zambia (MTZ) Champion Agents around Zambia and MTZ Accounts Department in Cape Town.

Vision Fund gives empowerment loans in 15 districts of Zambia with 80% of the loans targeted to women. To be eligible for a loan, one has to be running a business. Most loan recipients have small grocery shops commonly known as “Tuntembas” while others have small scale farming holdings. To identify the loan recipients, Vision Fund field officers physically inspect the settlements of the target clients and make suitable recommendations.

Vision Fund makes use of the MTZ Agent Network, which is spread across Zambia deliver loans to the recipients. Once Vision Fund identifies loan beneficiaries, the details are entered into the MTZ microfinance payments system. Upon approval, the loan recipient receives an SMS to go and collect money at the MTZ agent’s shop near them. In a month Vision Fund approves over 1,000 loans worth around $400,000, which are then disbursed through the MTZ system. Loan recipients are also able to repay their loans through the same MTZ agents.

My job as Account Manager is to ensure that a loan recipient, once approved, will be able to receive their cash at their local MTZ agent. I communicate closely with the Vision Fund team, the MTZ accounts team, and monitor the MTZ system to ensure that agents will have the necessary liquidity to make the pay-outs. The feedback we hear from the loan recipients is that they appreciate that the agents are close to where they live and the pay-outs are faster than the previous manual system that was employed by Vision Fund.

One of the most noticeable success stories is that of the MTZ Champion agent in Maamba located in the Southern Province of Zambia. The agent was set up to meet the needs of the Vision Fund loan clients in the area. The agent caters to loan clients that come from as far as 20Km away from the agent location in Maamba town.

A few of the key challenges faced by Vision Fund include the low level of literacy of their clients and the distance they must travel to reach the pay-out/pay-in locations. We’re working closely with Vision Fund to ensure that their loan officers are able to educate their clients about their role and how the system works. We are also working to expand the agent network to reach out to new areas, previously never served by any financial services. Our agent in Maamba, a rural community to Southern Zambia, was set up primarily to service these loan recipients and offer our other money transfer services. Before this agent, loan recipients would have to travel around 90km to access their loans.

MTZ Champion Agents operate as independent entrepreneurs. Mobile Transactions is working in partnership with Kiva to provide additional working capital to these entrepreneurs to better serve loan recipients and others across Zambia. To check out the profile of some of these entrepreneurs, check out the Kiva website: http://www.kiva.org/partners/210.