In September 2023, we invested in Jackfruit Finance.
Across most African markets, private schooling is prevalent amongst low-income populations, due to quality and access constraints across the public schooling system. In Kenya, 45% of the poorest segment of the population choose private schools. However, these schools lack access to affordable financing both related to working capital and project finance to invest in school facilities. Lenders credit score schools with methods designed for general SMEs, not taking into account the unique business cycles of schools (revenue through fee payments three times a year). Lenders require documentation such as audited financials, cash flow projections, and business plans that most schools don’t have. Hence, the schools are often forced to take on predatory loans to manage capital needs or temporarily close down the school, hence affecting the students’ education outcomes.
Piloted in 2022, Kenya based Jackfruit Finance offers schools two financing products: working capital to support school operations and smoothen cashflow; and project/asset loans to invest in much needed school infrastructure, for example building out classrooms. Through expanding and upgrading facilities, schools can onboard more students, hence increasing access to education. Similarly, through access to affordable working capital to smoothen cashflows, schools can ensure continuity and avoid temporary school closures.
In addition, to further drive positive educational and health impacts, Jackfruit offers Partner Reward programs to their customers through partnerships with NGOs and social businesses. Examples are school feeding programs, teacher training interventions, and water and sanitation programs.