Contribution of micro-finance institutions to the empowerment of women in Kapseret constituency, Wareng sub-County, Uasingishu county, Kenya

Abstract

One of Kenya’s vision 2030 strategies is to enforce Millennium Development Goals (MDG). Empowering women to eliminate poverty and retrogressive practices that cause vulnerabilities among women is one of the goals. The purpose of this study is to determine and discuss the contribution of micro-finance institutions to the empowerment of women in Kapseret Constituency, Wareng Sub-county, Uasin Gishu County Kenya. The objectives were to identify and discuss the services provided by micro-finance institutions and how they contribute to women empowerment, to examine the impact of the services offered by MFIs and how they contribute to women empowerment and to identify the challenges facing micro-finance institutions and the effect on women empowerment. The theoretical framework of the study was guided by a model by Naila Kabeer on women asserting their independent right to make choices and to control resources which will assist in challenging and eliminating their own subordination. The study adopted a descriptive research design. It was conducted through women groups and micro-finance institutions in Uasin Gishu County. The study area was Kapseret Constituency. The study sample was drawn from 20 women groups and 5 micro-finance institutions. Purposive sampling method was used to select 20 women groups from 65 women groups and 5 micro-finance institutions. Simple random sampling was employed to select 100 members from the 20 women groups and 10 micro-finance institution officers preferably those in the loans department. Questionnaire was used to collect data from the women groups while an interview schedule was administered to the bank officials. Descriptive statistics were employed in analyzing data using frequencies and percentages to meaningfully describe the distribution of scores. Data was coded, entered into a computer and analyzed using SPSS. The results showed that 85% of the women had accessed credit and engaged in different kinds of businesses. Based on the impact of services offered, it was established that micro-finance institutions had increased the capacity of the respondents by promoting community development; the constraints faced by micro-finance institutions included bad debts, competition from commercial banks and liquidity problems. Most respondent had accessed credit and some could repay the loan but those whose businesses could not sustain loan repayment became defaulters and others lost their property in order to repay their loans. The study recommended that; MFIs should come up with interest rates that are friendly to women and include women in decision making. This will improve accessibility to resources, the government should consider granting tax exemptions and offer incentives like giving them funds to offer interest free loans to organizations which seek to give credit to women as a way of motivation, as is done in Malaysia, more training programmes should be provided to women in order to improve their entrepreneurial skills and engage in income generating activities, and finally, extension services need to be improved, made reliable and be conducted on time.