MIT Solve

Solution Overview

Solution Name:

Sseguku Microfinance Uganda

One-line solution summary:

Lend small loans to low income entrepreneurs using group delivery method.

Pitch your solution.

We provide small loans to low-end income borrowers who have limited capital to put into their businesses and cannot access credit services from formal banks due to lack of collateral security, inadequate records due to high illiteracy levels and small size businesses which are considered costly to monitor. We use mobile money platforms to enable easy and convenient ways of carrying out push and pull transactions to keep low cost of operation, reduce fraud, convenience, increase outreach and microfinance depth. This would foster business growth, create employment, improve standard of living and increase financial inclusion.

What specific problem are you solving?

Limited Access to loans, many business entrepreneurs and businesses don’t have access to loans due to lack of collateral security like land tittles. This is a problem to women due to the culture where they are not allowed to inherit their fathers. Others with no land tittles are the youths who have not acquired assets after school. It also includes people with disabilities and elderly persons.

Another factor which hinders people from accessing loans is the small size of businesses that low end users have. They make small sales per day which is translated into small loan requirements generally considered expensive to monitor.

Lack of records, due to high illiteracy rate among low income borrowers, they are not keeping records in order to ascertain their business performance.

Lack of credit history, many of these borrowers have no credit history which makes it difficult to prove their credit worthy.

We use group lending delivery method where members sign for each other to ensure commitment of group members that in case one is unable to pay weekly repayments, they pay the missing payment and the covered member’s payment is obliged to reimburse those group members in the following week.

Who does your solution serve, and in what ways will the solution impact their lives?

Business growth, our loans disbursed to low business owners and businesses help to increase on their items which ultimately increases sales revenue. Other people expand the business by opening more branches or stalls while others open new businesses offering different products or services.

Create employment, additional loan capital strengthens the business and employs the business owner. As he/she the business grows or expands, employs more people to attend to it or the branch. Hence creating employment.

Improved standard of living, when sales income improves, people are able to pay school fees for their children, improving their households like home improvements, buy new clothing and buy meat twice or so a week.

increase financial inclusion, as more people save and borrow, increases on the number of people accessing financial services.

Increased use of innovative technology, our services are based on mobile money platforms, it means if one needs a loan from us, must have a mobile phone to be able to transact using mobile money services. It increases outreach and microfinance depth.

Which dimension of the Challenge does your solution most closely address?

How can countries ensure that everyone—especially vulnerable and marginalized groups—are able to apply/register for an ID in a way that protects people’s health, data, and the integrity of the ID system?

Explain how the problem, your solution, and your solution’s target population relate to the Mission Billion Challenge Global Prize and your selected dimension.

Sensitize the public by word of mouth using small hand-held speakers, local FM radios and through community leaders, associations such as for women associations, People with Disabilities (PWDs), employers, Saving groups like VSLAs and SACCOs.

Establish registration centers near the local communities to reduce on transport costs and increase on the processing time.

Use local languages to help those who cannot speak English be able to apply for IDs but also to understand and appreciate the value of getting one.

Adopt innovative IT solutions where one can register online to increase on the outreach and convenience.

Where is your solution team headquartered?

Denmark, WI, USA

What is your solution’s stage of development?

Growth: An individual or organization with an established product, service or model rolled out, which is poised for further growth in multiple locations.

Who is the primary delegate for your solution?

Kiyingi Yekosofaati