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Inside The Kenyan Slum Where A Virtual Currency Is Replacing The Shilling


June 29, 2020

Kenya’s capital city, Nairobi, is sometimes described as a paradox with two diametrically-opposite extremes. On the one hand, it’s home to chic, upwardly-mobile communities. On the other, some of those chic communities are sandwiched by some of the world’s largest urban slums.

Home to at least 80,000 people, Mukuru Kayaba is one of the more-populated slums in the Kenyan capital. In this low-income neighbourhood, families are using a virtual community currency to pay for food and other essential items during the coronavirus pandemic.

With jobs hard to come by and income levels shrinking, more than 500 people a day are signing up to use Kenyan Red Cross-supported community inclusion currency (CIC), known as Sarafu, to get food, soap, and other essentials, as VOA News reported.

Sarafu was developed by Grassroots Economics and U.S.-based engineering firm, BlockScience. By design, it works by putting financial contributions from donors into a community fund. The fund is then put to use in creating and backing the community credit.

Roy Odhiambo, an innovation officer at the Kenyan Red Cross, revealed that “one Sarafu is equal to one Kenyan shilling. So when we register the community, we are able to give them a token of 400 shillings. Now they are able to purchase basic goods and services within the community. This Sarafu is able to multiply if they are engaged in income-generating activities or even their businesses.”

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VOA News spoke to one Jane Mutuku, 49, who lives in Mukuru Kayaba and has found the e-voucher community currency to be a lifesaver in such torrid times.

Before COVID-19 happened, the mother of six supported her family through manual work, but jobs have dried up these past few months and so too has cash. These days, she buys food for the family using Sarafu.

“I looked for a job the whole of yesterday,” she said, “but didn’t get any job. So I decided to use my Sarafu to buy food. I have no food at home.”

Mutuku said she is able to prepare at least one meal for the day, thanks to the community inclusion currency.

There are currently about 100 stores in the Mukuru Kayaba area that accept the community currency, and it is understood that Peter Odhiambo’s food store is one of those.

“I can use the Sarafu to buy goods in the area,” Odhiambo said. “For example, if I want to buy rice from the big stores, I buy using Sarafu. For the things that are not available in my community, I turn my Sarafu points into local currency within our established groups. The groups help us to turn our Sarafu into Kenyan shillings.”

It is also understood that the shops in the area currently do about USD 10 K worth of business each day using Sarafu.

At least one million Kenyans have lost their jobs or have been put on indefinite unpaid leave since the outbreak of the pandemic, which has quickly become as much of a jobs crisis as it is a health crisis.

Like the hundreds of thousands of affected persons, the people of Mukuru Kayaba who have long been at an economic disadvantage are struggling to make a living. And even though this community currency initiative wouldn’t necessarily improve their economic standing drastically, it surely offers some respite.

Featured Image Courtesy: Ruben Centre

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