Small holder farmers in Kiambu County can now access credit and input finance easily thanks to an innovative firm, Tendo Micro Finance. The initiative aimed at spurring production using modern farming techniques is informed by lack of financing to smallholder farmers by financial institutions due to the perceived farmers’ high risk status.

Having witnessed firsthand how hardworking, ambitious but cash strapped farmers were, Peter Mbugua a budding entrepreneur decided to offer a viable solution. “Despite the fact that smallholder farmers in the country contribute to over 70 percent of produce, most financial institutions snub them preferring to deal with large scale commercial farmers,” he said.

The situation is worsened by the continued growth in human population which exerts pressure on the small size of land. “Most farmers in Central province have very small sizes of land which can only be satisfactory if their production can be optimized through use of modern technologies and to access the farm inputs to initiate the modern way of farming, one needs access to finance,” he added. This was Mbugua’s driving force to establish Tendo Micro Invest.

The finance which ranges from cash to tangible farm inputs is given to farmers who meet the firm’s vetting procedure which in most cases, any ambitious and practicing farmer can meet. We do not want to create the same hurdles that bar these farmers from accessing credits from the mainstream finance institutions and therefore our vetting procedure is a bit relaxed although we monitor progress and only deal with serious farmers. “One must indicate to us that he has been struggling to make it in farming but hindered by lack of some drivers towards that.”

In addition their definition of a small holder farmer only puts a limit to farmers with not more than four acres of land. Tendo uses Assistant Chiefs to vet the applicants. Mbugua explained that since the farmers are well known to the area leaders, they saw it fit for such leaders to act as guarantors for credit finance. The credit finance ranges from Sh5000 to Sh30,000 payable within 90 days at an interest rate of five percent. Although one can be given cash, Mbugua’s firm prefers facilitating the purchase of the actual farm input to help ensure that the cash is not diverted to other channels that are not agro-based.

After two years of existence Tendo Micro Invest is currently serving over 100 small holder farmers in Kiambu County although there are plans to widen its reach in the country.  Farm inputs given to farmers are geared towards implementing modern agri-business. The farm inputs include drip kits, Greenhouses, Water tanks, Irrigation pumps, Fertilizers, Seeds, and Chemicals among others.

Given that most farmers lack access to extension officers, the firm also offers free advice to their farmer clients on the best farming but mostly ignored profitable ventures. According to Mbugua, they encourage farmers to adopt ventures with long term benefits and shun the bandwagon effect referring to the recent quail craze.  “We give more emphasis on high value crops which are fast maturing. We are trying to redefine the art of farming among our farmers because our main concern is to see them earning a decent income from their small farms.” 

He explained that the traditional crops like maize which many farmers grow are not economically viable in Central province. An informed farmer cannot continue growing maize in Central when the crop takes almost a full year on the farm to mature. That is not sensible and yet there are other high value crops like herbs for instance basil, coriander among others which take a maximum of sixty days to mature and they even command lucrative prices in the market.