Flexible lending conditions and mobile loan eligibility assessment app making small loans possible for small businesses and entrepreneurs in Kazakhstan, particularly in rural areas
Almaty, Kazakhstan, 31 October 2018 – KMF, a Kazakhstan-based microfinance organization, joins Business Call to Action (BCtA) with a commitment to expand access to financial products and services for 40,000 new micro-, small- and agrobusiness customers across Kazakhstan by the end of 2018. KMF also commits to ensuring at least half of its new clients will be women, and will actively engage potential clients from rural areas.
Launched in 2008, BCtA aims to accelerate progress towards the Sustainable Development Goals (SDGs) by challenging companies to develop inclusive business models that engage people with less than US$10 per day in purchasing power (in 2015 dollars) as consumers, producers, suppliers and distributors. Over 200 companies, ranging from multinationals to social enterprises, and working in 68 countries, have responded to the BCtA by committing to improve the lives and livelihoods of millions in developing countries through access to markets, financial services, affordable healthcare, water and sanitation, education and other critical services.
KMF is a leader in the Central Asian microfinance sector and the largest microfinance institute in Kazakhstan in terms of size and outreach (54 percent of market share). It provides both individual and group solidarity loans in more than 4,000 locations across the country, with a focus on women entrepreneurs and inhabitants of remote rural areas. While traditional banks require official confirmation of an individual’s income in order to apply for a loan, KMF takes a more flexible approach based on the situation of the individual.
“We use our own methodology for assessing client solvency. If clients do not have official confirmation of their incomes, there are three approaches to analyzing the client's payment capacity: for agribusiness, for business and for salary as an income source,” said KMF CEO Shalkar Shussupov.
KMF loan officers are trained to do this analysis using a Mobile Expert app on their phones. All rules, conditions and requirements for the assessment of client's payment capacity are integrated into this mobile app, making it easy and efficient to use.
In addition to individual lending products, KMF also has a successful group lending model that is attractive to small business owners as it does not require any additional collateral other than the group guarantee. Loan amounts in group lending are increased gradually as a business grows and develops. There is mutual support in the groups, in that everyone is interested in timely repayment of loans by each member of the group.
“With these innovative and flexible approaches to lending, KMF is providing financial opportunities to small business owners and entrepreneurs that they would not have otherwise. With these small loans, KMF is helping its clients to grow or establish their businesses, and thus improve their and their families’ livelihoods,” said Paula Pelaez, Head of Business Call to Action.
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BCtA membership does not constitute a partnership with its funding and programme partners, UNDP or any UN agency.
About Business Call to Action (BCtA): Launched at the United Nations in 2008, BCtA aims to accelerate progress towards the Sustainable Development Goals (SDGs) by challenging companies to develop inclusive business models that offer the potential for both commercial success and development impact. BCtA is supported by the Dutch Ministry of Foreign Affairs, Swedish International Development Cooperation Agency (Sida), Swiss Agency for Development and Cooperation (SDC), UK Department for International Development (DFID), and hosted by the United Nations Development Programme (UNDP). For more information, please visit www.businesscalltoaction.org.
About KMF: KMF is Kazakhstan’s largest micro-financial institution: it is active in 12 out of the country’s 14 regions and runs a vast and expanding network of branches in the most remote areas. KMF encourages growth of micro, small and agribusiness representatives by providing access to quality microfinance services.