SUPPORTING ACCESS TO INCLUSIVE AND GENDER RESPONSIVE FINANCIAL SERVICES AND PRODUCTS. 

 

COMPONENT 1: FINANCIAL ACCESS AND RESILIENCE BUILDING 

PARTICIPANTS – 100,000 SGBV SURVIVORS FROM 16 COUNTIES IN KENYA 

 

TERMS OF REFERENCE:

FINANCIAL SERVICES PROVIDERS FOR THE ESTABLISHMENT OF THE JASIRI CONCESSIONAL LOANS SCHEME. 

 

1. INTRODUCTION 

The purpose of these terms of reference is to outline the requirements and expectations for a Financial Services Provider (FSP) to provide a concessional loans scheme. 

Program background 

The Jasiri Consortium comprising the Centre for Rights Education and Awareness (CREAW), Grassroots Organizations Operating Together in Sisterhood (GROOTS Kenya), Collaborative Center for Gender and Development (CCGD), Centre for Domestic Training and Development (CDTD) and Advocates for Social Change Kenya (ADSOCK) are jointly implementing the Jasiri Program for a period of 5 years (2023-2028). The program seeks to address market and funding gaps in access to finance by women-owned Micro, Small, and Medium Enterprises (MSMEs) affected by gender-based violence (GBV).  

Jasiri will increase access to financial services and support MSMEs owned by young women survivors of GBV from 16 counties in Kenya i.e., Kiambu, Kakamega, Tana River, Bungoma, Garissa, Kilifi, Mombasa, Nairobi, Meru, Nyeri, Mandera, Kajiado, Busia, Kwale, Samburu, Baringo, through engaging financial services providers and the State Department of Gender to build up transformative and inclusive financial services that cater to the full range of needs of young women GBV survivors. 

The program builds on the achievements of a pilot intervention implemented by the consortium during the COVID-19 pandemic to address the high incidences of GBV. The program will deepen support to 26,369 most at-risk girls and young women who are survivors of gender-based violence, with 70% being young women, persons with disabilities (PWDs), and refugees aged between 18-35 years.  

The Jasiri Program comprises 3 components as below: 

• Component 1 – Business Grants and Liquidity support to survivors of SGBV (US$ 3,000,000). This component aims to provide liquidity support to start-ups and MSMEs. The indicative size of microgrants to individual microenterprises will range between KES 10,000 and KES 25,000. 
• Component 2 – De-risking lending to GBV survivor-led MSMEs (US$ 3,000,000) through concessional loans. This component aims to provide liquidity support to women-led MSMEs through regulated financial Intermediaries, especially regulated retail lending financial institutions that have limited liquidity, with a focus on MSME banking, including those innovating with digital channels. Support will target women-led MSMEs that were previously financed in addition to those that are considered bankable but have not been able to access credit. The indicative size of loans to individual microenterprises will range between KES 50,000 and KES 1,000,000. The tenor for microloans is expected to not exceed 18 months, and for small loans to not exceed three years. A maximum grace period of two months may apply for both micro and small loans. The Concessional loans will be established to operate according to the Principles of Public Credit Guarantee Schemes as a sustainable mechanism of de-risking MSMEs. 
• Component 3 – Providing technical assistance to build the resilient capacity of the women-led MSME finance ecosystem beyond the lifecycle of the Jasiri Program. This component will provide technical assistance to build the resilience capacity of the MSME finance ecosystem beyond the lifecycle of the Jasiri Program. During the life of the program, the component will support the Jasiri consortium and the State Department for Gender and Affirmative Action in the delivery of components 1 and 2 to build up transformative and inclusive financial services that cater to the full range of needs of young women and GBV survivors and ensure overall growth of the MSME lending market in Kenya. 

 

1. OBJECTIVES  

The program thus seeks to implement a concessional loans scheme to support women-owned MSMEs to Improve access to finance from financial institutions, Mitigate the risks associated with lending to women-led MSMEs, Encourage financial institutions to increase lending to MSMEs and Support economic growth and development. The program aims to provide a guarantee to lenders to cover a certain percentage of the loan amount in case of default by the borrower. 

 

2. SCOPE OF WORK.  

This lending mechanism targets young women GBV survivors in MSMEs in the transition towards the expansion of their businesses and commercialization of their production activities and the associated MSMEs in the value chains. Specifically, this includes: 

• Direct Lending – Provide concessional loans to eligible MSMEs, using their own credit appraisal systems and criteria to process the loans. 

• Provide capacity building and business development services (BDS) for MSMEs to enable them to develop bankable business plans and formalize their business operations. 

• Design and structure the concessional loans scheme – Set eligibility criteria for MSMEs and establish the terms and conditions of the guarantee. 

• Conduct thorough risk assessments, identify risks, and suggest mitigation plans as they occur or before they occur. 

• Develop tailored financial products specifically designed for young women survivors of GBV. 

• Develop procedures for the application and approval of program participants. 

• Monitor and evaluate the performance of the scheme. 

• Prepare and share monthly portfolio analysis, portfolio monitoring, and portfolio reporting. 

• Uphold safeguarding and confidentiality protocols to protect the privacy and security of program participants. 

• Ensure direct staff are fully facilitated to attend sexual, harassment, exploitation, and abuse training and commit to adhere to the policy. 

• Report on the impact and effectiveness of the scheme. 

 

3. ELIGIBILITY CRITERIA OF FSPs 

An FSP will be eligible to participate if, in addition to the Concessional Loans Scheme eligibility criteria, it fulfills the following: 

• Licensed by the Central Bank of Kenya,  
• Knowledge of public finance management regulations. 
• Aligned to international best practices, including the World Bank principles for public credit guarantees. 
• Has large geographic branch networks in any of the counties in which the Jasiri program operates. 
• Has a wide sectoral coverage in its portfolio of credit facilities. 
• Maintains a portfolio quality above the market average that has been extended to MSMEs 
• Has experience in managing and extending credit to women MSMEs 
• Has the capacity to offer appropriate financial services, manage the risk of lending to the MSMEs, and reduce transaction costs. 
• Has management information systems (MIS) that support automation of client profiles and risk assessments. 
• Has capacity in Insurance products and solutions, such as bundled loan/input insurance packages to MSMEs. 
• Commits to deploy at least 70 percent of investment to young women, refugees, and persons living with disabilities (PwDs) and report this in the monthly progress reports. 
• The FSP’s readiness and demonstrable commitment to undertake effective gender-responsive financial options that target young women, especially from vulnerable communities. 

 

4. SUBMITTED PROPOSALS WILL CONTAIN:  

The FSP is required to deliver the following: – 

• A detailed proposal for the concessional loans scheme. 
• A high-level landscape assessment of MSME and specifically Women led MSME lending in the county the FSP is operating to determine the opportunity available for the FSP. 
• Proof of similar work done before 
• The FSPs’ areas of strength in WSME lending,  
• The FSP’s areas of improvement and recommended practical Capacity Development needs if any.  
• Demonstrated innovative approaches to undertake the diagnostic assessment or evaluation with the intention to at least cover among others the following areas:  
• MSME context and strategy, 
• MSME/WSME lending structure,  
• Staff capacity analysis,  
• Credit and other operational analysis, Etc.  

 

Applications are welcome from all Banks, FinTechs, and Microfinance Institutions working and operating in Kenya before 13th November 2024. 

 

Additional information 

Timeline – The FSP is expected to complete the implementation of the concessional loans scheme between November 2024 and November 2028.  

Budget – The budget and terms for the concessional loans scheme will be discussed and agreed upon during the proposal stage.  

Evaluation – The success of the concessional loans scheme will be measured based on the number of MSMEs supported, the amount of loans facilitated, and the impact on economic development.  

Approval – This term of reference is subject to approval by the Program Steering Committee [PSC] before the financial service provider can proceed with the implementation of the concessional loans scheme. 

Send your expression of interest to consultancy@creaw.org  

For any inquiries or clarification, please contact consultancy@creaw.org  

 

Download: Expression of Interest for FSPs