Watu Credit LimitedStatus: Approved investment
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Who is our customer
Watu Credit Limited (Kenya) (‘Watu’) is a micro-lending company providing pay as you go financing to young entrepreneurs operating motorcycles (boda bodas) and tuk tuks transport businesses in Kenya. Watu’s mission is to meaningfully improve employment and opportunities for those with the greatest barriers to access financial services. Watu has been operating since 2015 and currently has operations across Kenya serving more than 200,000 clients. 90% of Watu’s clients are youth (between 20 and 28 years) and 70% are based in rural areas.
What is our funding objective?
FMO’s loan will be used for on-lending purposes to self-employed individuals and will be used to specifically grow Watu’s youth and rural focused mobility portfolio in Kenya.
Why do we fund this investment?
The proposed facility provides an opportunity for FMO to support one of the top micro-lending institutions in Kenya to increase its MSME lending activities with a particular focus on youth owned and rural mobility MSMEs. As a non-deposit taking institution, FMO's long-term funding is also providing Watu Credit with stability and security of funding to enable it to further grow and expand its reach across Kenya.
What is the Environmental and Social categorization rationale?
Watu Credit Kenya is categorized as a low E&S risk (C) client based on FMO's policy with no IFC Performance Standards triggered transactions and in full compliance with FMO's exclusion list and national laws of Uganda. However, given the nature of the underlying mobility portfolio and their focus on individuals and micro entrepreneurs, the institution is considered a high risk for Client Protection Principles (CPPs). Therefore, FMO's loan is being provided together with capacity development to support the development of sector safety and awareness initiatives. The client is committed to comply with the CPPs and to address any gaps identified through the external assessment to become CPP certified.
|Date||Total FMO financing|
|12/16/2022||EUR 0.03 MLN|
- Website customer/investment
- Financial Institutions
- Publication date
- Effective date
- Total FMO financing
- USD 10.00 MLN
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C)