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It’s been over a year since COMRED, in partnership with Blue Ventures and Green Finance Limited (Greenfi), introduced the eco-credit project in Kwale County, Kenya. The main objective of the eco-credit project is to provide access to a revolving credit facility for communities as an incentive for marine conservation.
In the eco-credit model, a community member receives loans with a condition to carry out marine conservation activities such as mangrove nursery establishment, mangrove planting and patrols, beach clean-ups, and creating awareness about marine conservation, thereby building community financial and environmental wealth at the same time.
Through the project, 10 eco-credit groups with a total of 276 members (100 men and 176 women) were formed in April 2022. During formation, each group received a seed grant of 80,000 Kenya shillings which they turned into a revolving fund. The groups' are guided by a constitution that outlines the fund management rules and group conservation activities that each member is obligated to participate in in order to access loans.
In a period of one year, the majority of the groups have increased group membership from 30 to over 45 members, thereby increasing the total number of direct beneficiaries from 276 to 430 (133 men and 297 women) members. The groups have also grown the seed grant amount (80,000Kenya shillings ) by more than 50% through various sources such as registration fees, interest and administration fees, savings, loan penalties, and loan form fees. In addition, all eco-credit groups have achieved over 90% of the environmental conservation targets they had set during group formation, with some groups surpassing the set targets.
Eco-credit Scale-up. An opportunity to have greater impact
Following a successful one-year piloting of the project and the availability of additional funds from Blue Ventures, a criteria for the allocation of the additional funds ( 1,200,000 Kenya Shillings) to the eco-credit groups was developed in consultation with eco-credit members to ensure equitable fund allocation. The criteria looked at the level of achievement on environmental activities against the group’s set targets, membership growth, growth of the seed grant, and default management.
As a result of the additional funding, all eco-credit groups have a seed grant of over 145,000 Kenya shillings, up from the initially allocated amount of 80,000 Kenya shillings. This seed grant, in addition to other ways of growing the fund, has made it possible for all members to access higher loan amounts, with some groups issuing 50,000 Kenya shillings per member.
As the groups entered the second year of the project, they set new environmental conservation targets, and members are actively participating in these activities. Community members continue to have easy access to credit through the project and are able to improve their lives as they conserve marine resources. The project has also attracted a lot of interest from community members and neighboring BMUs.
Additionally, we are in the process of replicating this project in other communities in Kwale and Kilifi counties in order to reach more community members and make a greater impact. The future looks bright for the eco-credit project, and we are excited about the journey ahead as we support conservation of coastal and marine resources while providing access to finance.
