K-Rep Fedha Services Limited (KFS), registered under the Companies Act as a Limited liability Company, was established by K-Rep development Agency (KDA) in 2005 as a specialist FSA Management Company to provide management services and oversight to the FSAs.

The aim was to create a highly cost-effective approach to delivery of support and oversight services to FSAs in order to assure sustainability of individual FSAs and KFS itself. Underpinning the approach was the premise that a commercial environment would produce greater incentives for efficiency in service delivery at the level of the support organization. Underpinning the approach was the premise that a commercial environment would produce greater incentives for efficiency in service delivery at the level of the support organization.

KFS employs and deploys managers to the FSAs who are charged with the day-to-day management of the FSA operations.  Management capacity is spread across the network, with KFS head office providing technical backstopping. In addition to providing management services and oversight KFS has also been involved in outreach, promotion and establishment of additional FSAs.

FSD Kenya has supported K-Rep over the last eight years, focusing on testing the efficacy of the FSA model as a way of building sustainable rural financial inclusion.Financial Services Associations (FSAs) are rural membership based financial institutions offering credit, savings and money transaction services to their members.  The basic FSA model is similar in many respects to other types of decentralised financial institutions, such as savings and credit co-operatives, with local ownership of the share capital and a strong emphasis on user-owner governance and management. FSAs have grown and become naturally complex and outgrown the ‘self-help group’ notion. The larger FSAs are intermediating between members without strong relationships. The implicit, partial depersonalization of intermediation needs to be reflected in a more formal structure.  Practically, the larger FSAs need to acquire a legal identity to allow them to formally contract with members and others.