Request For Proposal: Consultancy services to develop credit risk management framework in Kakuma-Kalobeyei Area – May 2025

1.0 Le Fonds d'encouragement aux entreprises africaines

The AECF is a leading development organization that supports innovative enterprises in the agribusiness and renewable energy sectors with the aim of reducing rural poverty, promoting climate-resilient communities, and creating jobs.

We catalyze the private sector by surfacing and commercializing new ideas, business models and technologies designed to increase agricultural productivity, improve farmer incomes, expand clean energy access, reduce greenhouse gas emissions, and improve resilience to the effects of climate change. We finance high-risk businesses that struggle to access commercial funding; we are committed to working in frontier markets, fragile contexts, and high-risk economies where few mainstream financing institutions dare to go.

To date, we have supported over 510 businesses in 26 countries in Sub-Saharan Africa, impacted more than 33 million lives and created over 35,000 direct jobs.

L'AECF a son siège au Kenya et dispose de bureaux en Côte d'Ivoire, en Tanzanie, au Nigeria, au Sud-Soudan, au Bénin et en Somalie.

2.0 A propos du Kakuma Kalobeyei Challenge Fund (KKCF)

Kakuma Kalobeyei Challenge Fund (KKCF) est un programme quinquennal de la Société financière internationale (SFI), mis en œuvre avec l'Africa Enterprise Challenge Fund (AECF), le gouvernement du comté de Turkana et le HCR. La KKCF trouve son origine dans les données de marché de l'étude "Kakuma as a Marketplace" de la SFI, qui a quantifié l'économie de Kakuma et confirmé qu'il s'agissait d'une place de marché dynamique et potentielle. Cette étude a suscité beaucoup d'intérêt qui a contribué à la conceptualisation de la KKCF et à l'élaboration du programme.

KKCF is designed to support private sector investment and unlock the economic potential of refugees and their hosts in Kakuma Kalobeyei refugee hosting area in Turkana West District of Turkana County. KKCF aims to attract private companies and grow the local entrepreneurship potential to create job opportunities, present more consumption choices, and contribute to fair pricing of products and services. KKCF targets all sizes of companies from small to medium-sized family businesses to social enterprises and large firms. For more information, visit https://kkcfke.org/

La KKCF applique un mécanisme de financement concurrentiel pour débourser les fonds des donateurs afin d'inciter les entreprises à démarrer ou à étendre leurs activités dans la région de Kakuma-Kalobeyei. Le processus commence par la publication d'un appel à propositions, les candidats sont ensuite soumis à un processus de sélection compétitif qui aboutit à l'identification des entreprises les mieux adaptées à la dynamique du marché de Kakuma-Kalobeyei afin de produire l'impact socio-économique escompté sur les communautés d'accueil et de réfugiés tout en contribuant au développement du comté de Turkana.

With the Kakuma-Kalobeyei area being a marginalized and fragile setting, KKCF supports these companies to manage business limitations prevalent in such challenging environments including limited access to financing, low availability of technically qualified and experienced staff, complex social and cultural conditions, slow and bureaucratic regulatory environment and fragmented, low income and remote markets with poor infrastructure. KKCF support includes provision of concessional capital, technical assistance and policy advocacy to improve the business environment. This collaborative Program focuses on building commercially viable and sustainable businesses that can:

• Augmenter les revenus des réfugiés et des communautés d'accueil.
• Fournir des biens et des services essentiels.
• Créer des emplois et stimuler la croissance économique.
• Améliorer le niveau de vie des habitants du camp de réfugiés et des communautés environnantes.
• Promote financial inclusion efforts focused on increasing access to finance for women and youth.

KKCF is currently working with 105 commercially viable and sustainable microenterprises and 19 Small and Medium Enterprises (SMEs) across diverse economic sectors. One of the 19 SMEs is a Sacco Societies Regulatory Authority (SASRA) deposit-taking Savings and Credit Cooperative Society (SACCO). The SACCO has been in operation for a year in Kakuma and is looking to set up a credit management system and processes customized for the Kakuma Market.

3.0 About the Assignment

AECF is seeking the services of a Consulting Firm to support the SACCO in setting up a credit risk management system and processes customized for the Kakuma Market. The assignment will commence with a comprehensive review of its existing credit policy and procedures and loan underwriting capacity to identify gaps, and end with a customized credit policy framework and supporting manuals. The SACCO has a national membership of over 33,000 members, 3,500 of whom have been enrolled from the Kakuma–Kalobeyei area.

3.1 Objet de la mission

The purpose of these TORs is to define the scope, responsibilities, expectations, and deliverables of the engagement expected by AECF from the selected Consultant. The successful service provider must demonstrate experience and understanding of the refugee context and the Islamic banking/finance practices.

4.0 Specific duties and responsibilities (the “Services”) of the Consultant

The Consulting Firm will be expected to deliver on the following scope of the assignment:

a. Credit risk management needs assessment

• Conduct a comprehensive review of SACCO’s existing credit management policies and procedures applicable to the Kakuma Branch operations. This will include identifying gaps in knowledge, skills, and practices related to to loan portfolio monitoring
• Review the Kakuma Branch operations with a focus on risk identification, including concentration risk, operational risk, cybersecurity risk, market risk and, credit risk.
• Identify Kakuma Branch’s capacity to employ best practices in loan origination, loan portfolio monitoring and mitigating risk of loan defaults and loan recovery. This will include assessment of the loan origination process, loan underwriting skills, loan approval, disbursement, portfolio management, loan recovery and, compliance.
• Based on the assessment findings, develop a multiday training program for  SACCO staff involved in the entire loan life cycle. The program should enhance SACCO’s staff capacity in adopting best credit management practices across the loan life cycle. Clearly outline the expected outcomes and learning objectives of the training program.

b. Development of a credit risk management framework

• Design a market-specific credit management framework that aligns with Kakuma Branch operational context, particularly the fragile nature of the market it is operating in given the forced displacement setting.
• Incorporate risk mitigants in the credit policies, procedures and processes that help in identification and management of the various risks identified in managing Kakuma Branch’s loan portfolio. This should also include instituting compliance checks that ensure monitoring and adoption of these mitigants.  Design credit scoring models that will guide digitalization of lending in the MSME fragile market context.
• Develop detailed manuals and guidelines for loan origination and credit administration, incorporating industry best practices and compliance requirements including SASRA regulations.
• Establish clear performance metrics to evaluate the effectiveness of the newly developed framework.

c. Capacity building and training delivery

• Prepare training and capacity-building materials (decks, templates, tools) that address the identified gaps and new framework requirements.
• Facilitate training sessions for the SACCO teams, ensuring practical, hands-on learning and the application of new credit management processes.
• Assess the effectiveness of the training through feedback and post-training evaluations.

d. Reporting and insights

• Prepare and submit a comprehensive report outlining insights gained from the assignment, focusing on challenges and strategies specific to credit management in refugees and other fragile market contexts.
• Include actionable recommendations for sustaining improved credit management practices post-training.
• Provide an executive summary that highlights key findings, outcomes, and strategic recommendations.

e. Stakeholder engagement and communication

• Engage with relevant stakeholders, including loan officers and management, throughout the assignment.
• Conduct periodic progress updates and a final presentation of key deliverables to the company’s management team.

f. Evaluation and monitoring

• Develop a monitoring and evaluation plan to track the impact of the implemented credit management framework and training programs. Include measurable KPIs to assess improvements in credit appraisal and loan origination practices.

4.0 Deliverables

The Consulting Firm is expected to deliver the following:

1. An assessment/analysis report for the SACCO’s credit policies and procedures and loan officers’ skills with a gap analysis. This report will include recommendations on how to improve existing credit management policies to address the Kakuma Branch market dynamics.
2. Fit-to-purpose credit risk management tools that include frameworks and manuals for loan origination and administration and recovery customized for the Kakuma-Kalobeyei business environment and financial industry trends. These will also include clear paths to the attainment of competitive advantage and sustainability.
3. A training and capacity-building program and training materials for use by the SACCO for onward refresher training for their teams.
4. Metrics and tools to track and evaluate improvements made in the implementation of the credit management system over time.
5. An insights paper from this assignment highlighting the expected impact of adoption of the enhanced credit management framework for the SACCO.

5.0 Duration of the Assignment

The assignment is expected to be completed in three (3) months from the commencement date.

6.0 Rapports

The Consultant will report to the Senior Advisory Officer at the AECF and the KKCF Program Manager.

7.0 Proposal Submission

Les personnes ou équipes de consultants intéressées et qualifiées sont invitées à soumettre leur(s) proposition(s) comprenant les éléments suivants :

a) A technical proposal, max 10 pages (excluding annexes)

• Une compréhension des exigences en matière de consultance.
• Méthodologie et plan de travail pour l'exécution de la mission, étayés par une démonstration du rapport qualité-prix.
• Liste de références détaillée indiquant la portée et l'ampleur de missions similaires.
• Relevant services undertaken in the last five (5) years.
• Lettres de recommandation d'au moins trois entreprises ou missions précédentes
• Enregistrement et autres documents statutaires pertinents (ceci s'applique aux consultants institutionnels).
• All documents related to the technical proposal must be compiled into a single PDF file, organized with a clear Table of Contents

b) Une proposition financière

• Clearly showing the proposed team member, roles, and proposed days and the proposed professional fee (daily rate and total amount per team member). The financial proposal shall also include an indication of reimbursables (travel, communication etc.). Currency to be in KES.

N/B: TECHNICAL AND FINANCIAL PROPOSALS BE SUBMITTED SEPARATELY. COMBINING THE FINANCIAL AND TECHNICAL DOCUMENT AS ONE DOCUMENT WILL AUTOMATICALLY DISQUALIFY THE APPLICANT.

8.0 Qualifications and Experience

The Consulting Firm should possess the following skills and/or credentials:

• Minimum of 5 years of experience in working with SACCOS and MSMEs in credit risk management or similar assignments for lead consultants.
• Experience in developing a credit management framework and manuals for SACCOs.
• Strong understanding of SACCO operations and business model.
• Experience in training teams and developing effective credit risk management policies and procedures.
• Expérience de la supervision de la mise en œuvre et de la formation du personnel.
• Excellentes compétences en matière d'analyse, de communication et d'établissement de rapports.
• Knowledge of the development sector and in particular, working in the Kakuma/Kalobeyei area is an added advantage.
• An advanced degree in credit risk management, banking, or a related field for the lead consultant(s) will be a plus.
• Experience in Islamic Finance will be a plus.

9.0 Critères d'évaluation

MANDATORY EVALUATION CRITERIA.

a)  Mandatory Requirements for firms: –

1. Profil de l'entreprise.
2. Licence commerciale ou certificat d'incorporation ou certificat d'enregistrement et autres documents statutaires.
3. Certificat de conformité fiscale valide (applicable aux entreprises).
4. Passport/National Identification of the lead consultant and key personnel

N/B : LE FAIT DE NE PAS JOINDRE ET DE NE PAS RESPECTER LES EXIGENCES CI-DESSUS ENTRAÎNERA UNE DISQUALIFICATION AUTOMATIQUE.

Un comité d'évaluation sera constitué par l'AECF et pourra inclure des employés des entreprises à soutenir. Tous les membres seront soumis aux mêmes normes de confidentialité. Le consultant doit s'assurer qu'il répond pleinement à tous les critères afin d'être évalué de manière exhaustive.

L'AECF peut demander et recevoir des éclaircissements de la part de tout consultant lors de l'évaluation d'une proposition. Le comité d'évaluation peut inviter certains ou tous les consultants à se présenter devant le comité pour clarifier leurs propositions. Dans ce cas, le comité d'évaluation peut tenir compte de ces éclaircissements lors de l'évaluation des propositions.

Lors de la sélection finale du soumissionnaire qualifié, la qualité technique de la proposition sera pondérée à 80 % sur la base des critères d'évaluation. Seule la proposition financière des soumissionnaires qualifiés sur le plan technique sera ouverte. La proposition financière sera pondérée à hauteur de 20 % et les propositions seront classées en fonction du nombre total de points obtenus.

Les critères obligatoires et souhaitables sur la base desquels les propositions seront évaluées sont indiqués dans le tableau ci-dessous.

10.0 Tarification

L'AECF est tenue par les autorités fiscales kenyanes de retenir les taxes sur les honoraires des contrats de service et de veiller à ce que la TVA soit facturée le cas échéant. Il est conseillé aux candidats de s'assurer qu'ils comprennent bien leur situation fiscale au regard des dispositions de la législation fiscale kenyane lorsqu'ils élaborent leurs propositions.

11.0 Détails de l'application

L'AECF est un employeur qui souscrit au principe de l'égalité des chances. L'AECF examine tous les candidats intéressés en fonction de leur mérite, sans tenir compte de la race, du sexe, de la couleur, de l'origine nationale, de la religion, de l'orientation sexuelle, de l'âge, de l'état civil, du statut d'ancien combattant, du handicap ou de toute autre caractéristique protégée par la législation en vigueur.

• Interested consultancy firms are requested to submit their technical and financial proposal to aecfprocurement@aecfafrica.org by 12^th June, 5pm EAT
• All questions should be directed to the procurement email by 5^th June 2025, 5pm EAT.
• The subject of the email should be “TERMS OF REFERENCE FOR CONSULTANCY SERVICES TO DEVELOP CREDIT RISK MANAGEMENT FRAMEWORK IN KAKUMA-KALOBEYEI AREA”. The AECF shall not be liable for not opening proposals that are submitted with a different subject or responding to questions that did not meet the deadline as indicated.

 12.0 Disclaimer

L'AECF se réserve le droit de déterminer la structure du processus, le nombre de participants présélectionnés, le droit de se retirer du processus de proposition, le droit de modifier ce calendrier à tout moment sans préavis et se réserve le droit de retirer cet appel d'offres à tout moment, sans préavis et sans obligation de dédommagement et/ou de remboursement à l'égard de toute partie.

L'AECF ne demande pas de frais de candidature pour participer à la procédure d'appel d'offres et n'a pas désigné d'agents ou d'intermédiaires pour faciliter les candidatures. Il est conseillé aux candidats de s'adresser directement au département des achats de l'AECF.