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Faulu Bank Managing Director – Mr. Apollo Njoroge (left) and the Chairman Non-Governmental Organization (NGO) Council of Kenya – Mr. Samuel Githinji sign an agreement that will see the bank extend financial literacy training to NGOs

Africa

Faulu Bank inks deal with NGO Council in a bid to grow deposits

NAIROBI, Kenya, Dec 3 – Faulu Bank has entered into a mutual partnership with the Non-Governmental Organization (NGO) Council, in a bid to mobilize sticky and affordable deposits, as well as grow its Non-Funded Income (NFI) Line.

Through pursuing partnerships such as this, the lender is banking on long-term and sustainable strategies that will ensure the growth of its Current and Savings Account (CASA) and NFI line.

Commenting during the ratification ceremony held in Nairobi, Faulu Bank CEO Apollo Njoroge said, “Signing of this Memorandum of Understanding today will offer us an opportunity to support the council in capacity development and providing financial literacy to NGOs and Community Based Organisations (CBOs) while advancing our products and service to the NGO sector”.

“As a council, we have been having discussions with the bank and in the process expressed our desire for them to be pivotal in supporting and complementing the work that the NGOs are undertaking within the country. We are positive to support Faulu in any way we can to ensure that they partner with as many NGOs to achieve their mandate of capacity building through financial education,” said Mr. Samuel Githinji – Chairman NGO Council.

Currently, there are over 11,262 registered NGOs in the country that pursue various charitable purposes out of which 8,893 are active. In 2018/19, NGOs received a total of Ksh 165.97 billion which was an 8 per cent increase from the previous year. 88 per cent of these funds were raised from sources outside Kenya.

Total expenditure for the NGOs was Ksh 172.1 billion, representing a 15 per cent increase from 2017/18. On project implementation, NGOs spent Ksh 78.8 billion on projects in various parts of the country.

The bulk of the project expenditure was on health, HIV/AIDS, education and relief/disaster management at Ksh 13.0 billion, Ksh 10.6 billion, Ksh 9.4 billion and Ksh 8.8 billion, respectively. Most charities implemented projects in areas with good infrastructures, such as Nairobi, Kiambu, Kisumu, Nakuru and other urban Centres.

Findings by the Bank shows that CBOs are doing more work in the community and as of 2020 it’s estimated that they utilized Kes 12,325,671 in terms of project funding.

The MoU signed today showcases the potential for the bank to open over 100 NGO accounts, mobilize over Ksh.150 million in deposits at rates lower than 1 year T-bill rate and earn over 2million in foreign exchange income.

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