Knowledge, access and use of microfinance among small scale women business owners in Kiambu county, Kenya

Abstract

The main aim of the study was to investigate knowledge, access and use of microfinance by small scale women business owners in Ndumberi, Kiambu County. The objectives of the study were to establish knowledge of range of microfinance services available among women, assess level of access of microfinance facilities and use by women, establish barriers and constraints faced by women in accessing microfinance assistance, and explore ways of circumventing barriers and use of microfinance by women. Descriptive survey research design was adopted for the study. Quantitative data was obtained from purposively selected sample of 50 small scale women business owners who were interviewed using questionnaires which were randomly issued and qualitative data was obtained form 4 Key Informants who were credit officers. . The study found that the vast majority (92.9%) had gained knowledge of MFIs through friends. A majority of these respondents had gained this knowledge between years 2005-2009. This could attributed to the high publicity on MFIs given by the then existing government of President Mwai Kibaki. The majority (77.3% ) of the small scale women business owners did also report receiving credit without difficulties. However, a minority did report experiencing difficulties in their effort to secure credit, as a result of lack of collateral, complex bureaucracy, lack of documentation, and lack of monthly bank account cash flow. A majority of the respondents used the loans to expand their then businesses; others started businesses and bought assets. The study found out that microfinance played a part in empowering and improving livelihood of women. Following these results, we recommend that financial institutions put in place simpler ways of accessing the financial facilities for the women small scale businesses and give them at reasonable rate to enable them to repay with ease. Most MFIs in the area have increased the number of field operative to reach the interior parts of the area, to educate and advice women on microfinanceservices.