Information for Funders and Investors

The Role of Outside Funding

Rafode has been sustainable since it first began its operations.  The interest from our loans is enough to cover both overhead and inflation costs.  External funding, however, injects the capital necessary for rapid growth.  Funds allow Rafode to provide a greater number of loans, touch even more lives, and generate revenue to fuel further growth. 

Loan Statistics

Rafode makes 11% profit on every shilling it lends.  Revenue from fees account for 45% of total revenue while revenue from interest accounts for the remaining 55%.  Fees, of course, are levied at loan generation, while interest is paid during the course of the loan.  Such a dynamic produces a healthy mix of lump sum and scheduled income.  It should also be noted that Rafode’s interest rates are comparatively lower than other MFI’s. 

Loan Period: 6 months (24 weeks)
Typical Loan Size: 10,000 Ksh / $150 USD
Interest Rate: 18%
Interest Income per Loan: 1,800 Ksh / $27 USD
Fees Collected Upon Loan Generation:  1,450 Ksh / $22 USD
Total Income per Loan:  3,250 Ksh / $50 USD
Percent Return per Loan: 32.5%
Percent Profit per Loan: 11%

Costs

Rafode spends 1,800 Ksh for every 10,000 Ksh loan that it issues.  These figures, however, include the one-time startup costs incurred during the first six months of operations.  As Rafode continues, costs as a percentage of loan revenue will drop significantly.

2007 Q1 and Q2s Overhead Costs:  265,000 Ksh / $4,020 USD
Cost per Loan: 1,800 Ksh / $27 USD
Cost as a Percentage of Loan Revenue: 55%

Portfolio Growth

Rafode is growing at an impressive rate.  The organization has managed to grow its portfolio by 32% without any external capital injections. 

For further Information or to provide assistance to Rafod, please contact us.