Micro-Finance Institutions And Socio-Economic Empowerment Of Women In Kisumu East Sub-County, Kisumu County, Kenya

Abstract

This study examined the impact of Micro Finance on rural women's empowerment in three rural electoral County Assembly Wards (Kajulu, Kolwa Central, and Kolwa East) of Kisumu East Sub-County, Kenya. The study's objectives were to assess socio-economic activities undertaken by women utilizing MFC funds in Kisumu East Sub-County, to examine the influence of micro-finance credit on the livelihoods of women beneficiaries in Kisumu East Sub-County, to evaluate the effects of micro-credit on achieving equity in families and to assess the influence of microfinance on social mobility of women in Kisumu East Sub-County. The study used Financial Inclusion Theory (Ozili, 2020) and Identity Empowerment Theory (Perkins and Zimmerman, 1995). A mixed methods research design was used in this study to collect and analyse both quantitative and qualitative data. The population of the study were members of 25 registered trader groups in Kisumu East Sub-County rural wards with a population of 400 registered members. The study used purposive sampling technique to come up with the study’s sample of 8 registered Self Help Groups based on the number of women receiving loans from Micro Finance Institutions, thus SHGs with the highest number of members receiving MFC and the highest number of institutions providing MFC were considered. From each SHG, the respondents were selected purposively based on the individual records of accessing loans particularly the number of credit providers. Thus, those with more than one provider were selected. In total a sample of 120 registered members representing 30% of the registered members were interviewed. MFIs were identified using purposive sampling procedure.The questionnaire data was analyzed using SPSS 28. Key Informant interviews were conducted by Senior microfinance credit officials and representatives of registered women self-help groups accessing microfinance credit, while Focus Group Discussions were held consisting of 2 officials of women groups and 2 women group members from selected self-help groups in each ward who utilize microfinance loans. Quantitative and qualitative analysis of data was done and presented in terms of percentages, means, averages, variances, verbatim opinions and reports. Corroboration and triangulation was done for validity of quantitative and qualitative data. The survey found that women in Kisumu East Sub-County use MFC to buy business stock, land, cows, houses, machinery, household products, school fees, and savings. Microfinance credit improved family life in rural Kisumu East Sub-County by creating income and jobs, promoting justice and social mobility, enhancing women's self-confidence and sparking political involvement. The study also concluded that the microfinance industry in the sub-county is challenged by weak infrastructure, regulatory policy issues and the need for institutional leadership. The study recommended that Microfinance Institutions should promote market segmentation to help poor people gain assets, improve household welfare and manage vulnerability. Market research for new and diversified financial products should be supported by MFls to improve customer retention, client satisfaction and impact. The study also recommended MFls to strengthen ties with microfinance, academic, and research institutions to share experiences. Therefore, improving MFI operations and growth in Kisumu East sub-county will help achieve Kisumu County's Poverty Reduction Strategy goals. The study was of great significance in highlighting the role of microfinance institutions in the empowerment of the poor through the provision of microcredit, entrepreneurial training, monitoring and supervision.