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Musoni Microfinance 


Two Distinctions: Transformers Award 2021

Award 1

Best Combinatorial Innovation Processes

Category: Transformation 

Award 2

Best customer experience related to the “credit services”

Category: Customer Experience 

How Combinatorial Innovation is fostering Musoni impact and success?

Being the first 100% cashless and paperless MFI, Musoni has, since its inception, leveraged on technology to offer affordable financing to the most under-privileged adults, reaching out to women, youth & other marginalized members of society, who mainly reside in rural areas. Musoni’s business model was greatly facilitated by the mobile money market revolutionization in Kenya, which created the much-needed mobile money business environment.

Musoni's goal of using combinatorial innovation is to gain business advantage by leveraging multiple emerging technologies and integrating them to solve business problems in an agile way. So far, one of the key enabling technologies in pursuit of combinatorial innovation for digital transformation at Musoni is the use of APIs (Application Programming Interface). By using APIs and agile development methods, our talented software development team has, within a relatively short period of time, easily integrated multiple services in a single user application as a customer solution within few days.

Bringing traditional microfinance into the digital age is not easy. Musoni, with a high-touch and high-tech business model, was designed to simplify the process for adaptation and growth. At Musoni, rather than creating new technology stacks, tools, processes and methods, we combine our innovation with specific business functions and create new business capabilities for customers and market demands. Our customers benefit from all our services from one-stop-shop (like short, medium and long-term credit facilities, savings, insurance, etc.) through our Musoni Combinatorial Innovation Model.

The following are the main focus areas on digital transformation:

Channels: One of the most important lessons learned from the COVID-19 pandemic is the need to find new ways to reach customers, interact with them and meet their needs. Many providers have by necessity started building alternative channels in response to the pandemic; however, Musoni was already using agent networks, remote customer on-boarding and enhanced use of customer-centers.

Use of data: Data is increasingly becoming a central focus to financial services business models, and this trend will only accelerate. We are always digitizing and managing customer data. Our ability to gather and use relevant data is central to many of the changes that must be undertaken, from risk-based pricing to effective credit risk management, from new product design to customer relationship management, and from improving operational efficiency to growing the portfolio over time.


Product diversification: We are always expanding our services in a way that allows us to meet customers’ demands, to build loyalty, and to find a way to make the services of third parties available without losing the relationship with the customers. To achieve product diversification, we rely more on data, as well as back-office capabilities and technology (credit scoring model, cashflow, system based cashflow analytics, etc.).  

Flexible core systems: All of the above can’t be achieved without a flexible IT and data management system. Our ability to evolve and adapt business models and their reflection in more agile IT systems is increasingly a driving factor in the digital age. Indeed, cloud computing and Software as a Service (SaaS) are a game changer for Musoni.


Musoni will always embrace digitization and the use of technology, as it has over the past decade, in order to bridge the financial inclusion gap whilst advocating for good living standards, quality health care, access to Education, clean energy and water.

Combinatorial innovation is vital for our business strategy of products, customer services and experience for modernizing and transforming business organization.  


What are the highlights of the customer experience related to credit services by Musoni?

In 2009, Musoni Services launched Musoni Kenya, the first 100 percent mobile microfinance institution. In 2013, Musoni’s loan officers started using a mobile application on tablets instead of paper forms. This new app facilitated client on-boarding, loan creation, business appraisals and report viewing, improving loan officers’ productivity (through increased caseload). Using mobile devices also triggered organizational change, as data entry clerks were promoted to field officers, digital information replaced paper forms and digital photos of client IDs replaced photocopies of national IDs. As a result, efficiency improved, with loan application forms shrinking, and loan turnaround time decreasing from 72 to six hours. In 2017, Musoni developed a USSD menu for customers to access balance enquiries, loan applications and customer referrals. Musoni’s solution is integrated with the Credit Reference Bureau and relies on credit scoring for automated loan decisions based on digital data collected from clients over the past five years.

Better value proposition for Musoni: 

Operational efficiency/lower cost per transaction: The use of digital solutions increases the productivity of Musoni as staff do not have to spend time filling out paper forms before entering data into the system, while the introduction of automated processes and using e-money (M-Pesa) for transactions reduces staff fraud, errors and the risks associated with handling cash. From this data, we also provide personalized services to our customers and measure the social impact through Poverty Probability Index (PPI).

Client acquisition and diversification of customer base with value-added services: Equipping field staff with digital devices (tablets) to collect savings and/or having loan officers use tablets for loan requests and approvals enables Musoni to increase the amount of savings collected from existing clients and expand its loan portfolios. The convenience of these methods may also attract new customers.

Reaching rural areas at a lower cost: The cost of using digital devices and operating through agents is about 25 percent lower than opening and operating through a brick-and-mortar branch.

Greater customer loyalty and retention: Through our Digital Financial Services (DFS), microfinance providers can offer a better customer experience and provide quick responses while offering similar services to those at branches. Customer service and experience were improved (faster, more convenient, high-Tech high-touch, more individualized, real-time services).

Additional revenues: Introducing DFS solutions increases revenues (through savings mobilization and revenues from additional loans) while decreasing the cost of funds.

Greater savings mobilization: DFS provides customers with easier-to-use and access savings tools, such as loan officers using digital field applications to collect savings on their doorstep or digital savings accessible through a mobile phone. These digital tools make the formal savings process more convenient and increase the likelihood that customers will save. 

As a fully customer-centric organization we always strive to:

  • Understand customer’s needs, expectations, and behaviours which drives our decision-making.

  • Customer empowerment, engagement and retention for continuous improvement of products and services are considered essential elements of success.

Musoni - Distinction - Transformers Awar
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