Kisumu community looks to investment clubs for economic freedom

Caroline Onyango of Nenombele group at her shop in Kisumu. Photo/Anita Chepkoech

By ANITA CHEPKOECH        

Kisumu’s low-income earners are fighting poverty using investment clubs that allow them to take loans to start small businesses.

Residents have formed a community-based organisation called Nenombele that has groups of between 25 to 40 members where one can save money, take a loan and invest in business.

The organisation that was started as an informal savings club a decade ago has grown its membership from 15 to 110.

Samson Adongo, the secretary- general of Nenombele, said the organisation has helped members to save money to educate their children, invest in livestock, or start small businesses.

John Otieno, the chairman of one of the groups, said unemployment was a burden in the community as jobless youth would terrorise and steal from residents, frustrating everyone’s effort of self-development.

“Some were not even getting married for lack of income to bring up families,” said Mr Otieno.

“We thought of empowering them to reduce crime due to poverty,” he said.

Nenombele has come up with creative solutions to address the residents’ needs, turning small projects like horticultural farming into profit-making ventures.

Carol Onyango, the treasurer, is one of the beneficiaries of the organisation. She now sells second hand clothes and manages one of the group’s business dealing with logs located in Nyamasaria.

Members who plant trees sell their timber to the Nyamasaria business, hence money circulates within the group.

“I buy one two-year old eucalyptus at Sh150. I then split it into sizeable portions, which can generate a profit of up to Sh300,” she said.

The members also grow vegetables and have become the main supplies of food in the region.

The members share dividends which is used by others to expand their businesses. “We have about Sh965,105 to share,” Ms Onyango said.

Nenombele has strict rules to avoid risks such of over-borrowing and huge debts.

Due to high default rates that characterise most investment clubs, members of Nenombele that borrow more than Sh30,000 are charged an extra five per cent interest rate compared to the usual 10 per cent interest.