In the ashes of a looted market in one of Africa's biggest slums, gang leader Bernard Njira stood with a machete in his hand, trying to decide whether to kill the man who had approached him.
It was 2008, in the depths of Kenya's post-election bloodshed, and his gang of young thugs had just destroyed one of the biggest markets in the Kibera slum. Now came a man who wanted them to rebuild it.
Mr. Njira had been a criminal for 10 years: a thief, a mugger, a drug dealer and killer. The man who approached him was from Jamii Bora, a microfinance lender that supported many of the market's impoverished vendors. The gang assumed he was a police investigator.
"I almost killed him," Mr. Njira recalls. "I removed one of my machetes."
The man refused to back down. Amazed by his courage and persistence, the gang leaders began talking to him. A few weeks later, they rebuilt the market - and gave up their life of crime. They joined the microfinance group and became its most visible supporters, creating a metal workshop and a soccer team to bring hope to the slum.
Criminals, beggars, prostitutes and homeless people are among those who have become leading members of Jamii Bora (the name means "good families" in Swahili). With more than 300,000 members, it has become Kenya's fastest-growing microfinance organization, offering a new way of rising from poverty in Africa.
"Jamii Bora actually saved my life," Mr. Njira says, showing the scars on his hands from his gang battles. "I've seen a miracle happening in my life. They came into my life when nobody else in Kenya would help me because of my bad doings. The government would have shot me dead because I was a hooligan."
Microfinance, which offers tiny loans to some of the world's poorest people to help them create small businesses, began in Bangladesh in the 1970s and has grown dramatically since then, providing loans to more than 150 million people.
Most of this growth has been in Asia and Latin America. Microfinance has been slow to reach sub-Saharan Africa, which has less access to banking than any other region of the world. Africa contains only 4 per cent of all the institutions that offer loans to low-income people worldwide, according to a report by the development agency CARE, a pioneer in microfinance in the region. The report describes Africa as "the last frontier for microfinance."
Jamii Bora was founded in Nairobi in 1999 by Swedish architect and housing activist Ingrid Munro, who - along with her Canadian husband - had adopted three street children in the city. Through the children, she befriended a group of beggars, who helped her to create Jamii Bora and became its first members. Beginning with small loans to 50 beggars in 1999, the organization has grown rapidly, lending more than $40-million to its members in the past 10 years.
"Jamii Bora doesn't accept excuses," Mr. Njira says. "They don't say that you, Bernard, are a thief and cannot change. Or you're so poor that you cannot do business. They take people as equals. They explain to you how you can start a small business, and from there, you can change. They don't allow anyone to say, 'No, I cannot do it.'"
To receive a loan, its members must prove they can save money. If they save money for six weeks at Jamii Bora, they can receive a business loan of up to twice as much as their savings. The first loan can be as small as a dollar and as large as $130, and the member must repay it within 50 weeks, at an interest rate of 0.5 per cent per week.
Many members repay their loans within a few weeks and then move to a bigger loan. After repaying three loans on time, they can qualify for two-year business loans of up to $9,000.
Jamii Bora became so successful that it expanded into loans for school fees and housing. It created a health-insurance plan, a business academy, a counselling program for street beggars, and a treatment program for alcohol and drug addicts. Last year, it acquired a majority stake in the City Finance Bank in Nairobi, allowing it to expand its formal banking services for low-income people.
Despite the impressive growth, some experts question whether microfinance is the best model for solving Africa's poverty problem. "People have to do more than join the kiosk economy, which is what a lot of microlenders do," says Ian Smillie, an Ottawa-based researcher who has written a book on microfinance. "That may help them add to their livelihoods, and in some cases it might tip them over the edge upwards out of dire poverty, but it isn't a profound answer to systemic poverty and the disconnectedness of the poor."
For people such as Bernard Njira, however, the microfinance organization has made a huge difference. He was a Grade 4 dropout from a rural village who became a criminal in Nairobi when he was still a teenager. He teamed up with another criminal, John Ouma Oyoo, known as "the General," and they formed a gang that terrorized the Kibera slum.
In the election violence of 2008, they burned down the Toi Market and claimed its land as their property. That was when the two gang leaders were approached by Andrew Onyanga, a field officer at Jamii Bora, who wanted to negotiate passage for emergency food supplies for the 1,700 vendors who had lost their stalls when the market was torched.
Although their first impulse was to kill him, Mr. Njira and "the General" soon became intrigued by the man from Jamii Bora. "You can be good people," he kept telling them.
After they rebuilt the market, the two gang leaders were given loans of $130 each from Jamii Bora. They immediately went to a bar, planning to spend the entire amount on alcohol - until Mr. Onyanga spotted them and persuaded them to stick to their business plan.
"Jamii Bora is like a family," Mr. Njira says. "It's like my second god. Now I'm free from violence and stealing, and I'm free from beer and drugs. Jamii Bora taught me how to save money, borrow money, make a profit from my business. The change that you're seeing in me now - it only came because of Jamii Bora."
Geoffrey York