Site selection for microfinance facilities using GIS case study: Kibera slums, Nairobi County

Abstract

There are many Microfinance Institutions (MFIs) operating in Kenya; both licensed and unlicensed by the Central Bank of Kenya to serve the Small Micro Enterprises (SMEs) such as small retail shops, street vending, artisan manufacture, service provision, drug stores and so on. With arising need and availability of resources, it is not difficult to open a new MFI branch or agent, but to find a suitable location for the MFIs might be essential and challenging. For example opening a branch in areas with low population density may only increase administration cost without realizing benefits. On the other hand, opening a new branch in an area where there are many MFIs providing same service is also a tough business for the owners. However, to investigate a suitable site for Microfinance takes a lot of time and money. The technology of Geographical Information Systems (GIS) can help people to view, understand, interpret, and visualize spatial data in many ways that reveal relationships, patterns, and trends. This project identifies criteria for analysis of potential site for Microfinance facilities in Kibera Slum as security, high population density, existing financial Institutions in the study area and proximity to the main roads. It applies features of GIS to create baseline information; criterion maps and analyzes these spatial data using GIS and Multi Criteria Evaluation (MCE) to efficiently choose a suitable site for new Microfinance facilities in Kibera slum, the study has demonstrated that similar techniques can be used elsewhere with good results.