WAJIR, Kenya (Thomson Reuters Foundation) – Hamara Hujale tries to keep an eye on two squirming children and a pot of simmering ugali – a white doughy dish – as she reaches for her buzzing phone.
Hujale, who lives in the northeast Kenyan town of Wajir, used to make and sell kitchen utensils, "mostly to pastoralists who would use them as dowry for their daughters’ weddings".
Last year she secured a loan of 370,000 Kenyan shillings (about $3,560) through Crescent Takaful Sacco, an Islamic finance institution, and used the money to buy a tuk-tuk and set up a taxi business in Wajir.
But in this Kenyan region bordering Somalia, where over 90 percent of the population is Muslim, few banks or institutions offer financial services that comply with Islamic law, which bans gambling and speculation, including interest-bearing loans, said Diyad Hujale, a program coordinator at Mercy Corps, a charity, and no relation to Hamara.
Repeated droughts create "a vicious circle where they not only have no alternative income if they have lost their harvest, for example, (but) they are also made more vulnerable to the next shock", she said.
While many clients use the sacco as a way to boost their cash on hand, others like Hamara Hujale take out larger loans to set up their own businesses.
That fills a key gap in the market that is not met by other banks or institutions, Diyad Hujale said.
Key to the sacco’s model is trust, said Mutisya.
Hamara Hujale, who took out a loan on her own, now makes up to 2,000 shillings ($20) per day from her two businesses – nearly twice as much as when she only sold utensils.
Simonet said a mobile service would make particular sense for pastoralists.