Premier Kenya Limited is not new to MYC4 , as you would recall, they were the borrowers of the whole sale loan that was disbursed a few months ago. Premier Kenya joins MYC4 as providers of small business and group loans.
Premier Kenya is microfinance that specializes in credit only and was incorporated in 2014 January. Run by experience microfinance professionals, Most of Premier Kenya’s staff was working with MYC4 former provider Micro Africa and therefore have a vast knowledge on how the MYC4 system works. Premier Kenya was founded by Tim Carson and James Mugambi who are the former sole directors of Micro Africa Ltd. During the first months of operation, Premier Kenya recruited 2500 active clients in its first 5 months of business and has a portfolio of KES 240million. Average loan size at present is approximately KES 100,000. (approximately 900 Euros)
Products
Premier focuses on several products, which include-:
- Group Loans – Product is meant for customers in groups of 3-20. Individuals form the groups and co-guarantee each other when applying/taking loans.
- SME Loans – This product is the Premier Kenya business loan. This is given to both secured and unsecured business loans. The unsecured SME loans are offered to small and medium enterprises with no formal securities.
- Housing Improvement Loans – This is alos given to those with or without securities and has enabled many households to improve their living standards by improving their housing structure etc.
Loan terms vary from 6 -36 months depending on usage of the funds by the client and also the amount required by the client.. These are some of the products that they will upload on MYC4.
So when do we get an update about the (Non-)Performance in the 3rd Quarter 2014???? And an update about the status of various providers would be useful. i.e. KEEF, Mtaji
Personally I do not intend to invest anything more here until I have some clarification on these issues. I am sorry for those providers such as Premier Kenya but they should also realise that unless the system is professionally managed then there reliance/business model with financing from MYC4 will have problems in the future.
For months now there have been numerous empty promises that e.g. KEEF will soon resuming payments. Specifically I would categorically request that you answer the following questions:
What actions has MYC4 actually undertaken in the previous months?
Where /What are the results of those actions?
What scenarios exist for the future?
First of all, welcome to the new provider! The problems within MyC4 however are big, so I fully support Chris.
As an outlook to the upcoming provider update (when?), I made some personal observation:
• KEEF: Only minor repayments of OLB. Basically nothing. Not as ‘hoped’ in the last provider update.
Why did KEEF stop repayments? Fraud. But last two months? Unclear to me.
• Yehu: Continues repayments. Nice
• Mtaji: No change of OLB. No repayments. Not as promised in this provider update.
Why did Mtaji stop repayments? No clue given (since May!).
• Tujijenge Tanzania: Repays unregularly (personal portfolio cleared, thanks!)
• Tujijenge Uganda: Keep promise of repaying E 1.300. Takes a year to clear portfolio this way
• Uganda Microcredit: Stopped repayments one month ago, by which the PAR30 rose to over 30%. However, about a week ago they cleared their delayed repayments.
Why did UM stop repayments? No clue… as investor I can just be happy they started repayments again and pray for the future.
• Milango: PAR30 rose from 0% on August 5th to 79% now. What happened?
Conclusion: some providers are doing ok (Yehu, Fanwika, Sisdo, Jubilant (poor statistics due to young provider)). Some are in the danger zone (Milango, UM, TT, TU) and too much are stable on a level of no repayments since months (KEEF, Mtaji).
This results in the fact that only 42% of the loans is on track and a PAR90 of 47%. Judge yourself.
First of all KEEF did not stop repaying 2 months ago in my case but they stopped mid June at exactly the same time as they hit the ceiling of 750000 euros and could not have any more loans.
Is this a sort of revenge or is it more serious.
MyC4 was subject to a pyramid fraud some years ago – from a company called Ebony (if my memory is correct). I sincerely hope that MyC4 has learned a lesson from that “incident” and that KEEF is not another pyramid fraud.
In pyramid frauds loans are “fake” and you repay active loans from the money you get in from new “fake” loans. This obviously is not sustainable in the long run, so at a certain point (when you hit a ceiling?) you just take the money and run.
MyC4’s complete silence on the case opens up for all kinds of “conspiracy theories” 😦
—lars