Mastercard Creates New Program for Microfinance in Kenya

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SEATTLE — MasterCard has developed a new app to provide services of microfinance in Kenya called 2KUZE, which means “let’s grow together” in Swahili. 2KUZE allows farmers to sell products to customers directly through their phones.

Agents receive an order from a customer at a market stand and message the order to farmers. Farmers can then accept the order and give the product to agents so they can sell it to the buyer. Agents can accept the money from the buyer to pay the farmer either in cash or through other forms of transfer.

2KUZE builds on a microfinance program already used in Kenya called M-Pesa, which uses mobile technology to allow people to transfer money through mobile agents. It was created by Vodafone and an African company called Safaricom. It started in Kenya in 2007 and is operating in a handful of other developing countries around the world.

Corruption and insecurity are two of the greatest challenges to Kenya’s economic security, but this app will help improve both. The traditional process is for farmers to sell their products through food corporation middlemen. 2KUZE will make the process more efficient and empower the farmers by letting them negotiate their own prices.

This type of system is especially beneficial for women in Kenya, who must normally stay at home, but now have more opportunities available to them. Agriculture funds two-thirds of Africa’s labor force, according to the World Bank. As of right now, 2KUZE serves about 2,000 farmers in Kenya, and will soon expand to Tanzania and Uganda, which will allow crop trade between the countries.

MasterCard’s Lab for Financial Inclusion created the program with the help of the Bill and Melinda Gates Foundation and Cafédirect Producers Foundation. While MasterCard offers the service to farmers for free, MasterCard Africa is looking into monetizing it in the future. MasterCard is also looking into expanding the service to different continents.

Considering the ease with which this kind of technology can be spread and replicated, this may be just the beginning for microfinance in Kenya.

Jennifer Taggart

Photo: Flickr

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Jen Taggart

Jen lives in Strongsville, OH. Her academic interests include Journalism and International Studies. Jen is considering a career in non profit marketing.

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