a research proposal on the impacts of microfinance in kenya

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By Fred M’mbololo Page 1 MICROFINANCE AWARENESS AND IMPACT IN KENYA: A CASE OF NAIROBI COUNTY

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Page 1: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 1

MICROFINANCE AWARENESS AND IMPACT IN KENYA: A CASE OF NAIROBI

COUNTY

Page 2: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 2

Table of Contents 1. Background of the study .............................................................................................. 3

1.1 Statement of the problem ....................................................................................... 7

1.2 Conceptual Framework .......................................................................................... 9

2. Industry background .................................................................................................. 11

2.1 Significance of the study ...................................................................................... 11

3. Research aim, research questions or hypotheses and objectives ............................. 13

3.1 Research Aim ...................................................................................................... 13

3.2 Research questions ............................................................................................. 13

3.3 Hypothesis ........................................................................................................... 13

3.4 Objectives ............................................................................................................ 13

3.5 Assumptions of the study ..................................................................................... 14

3.6 Limitations of the study ........................................................................................ 14

3.7 Delimitations to the study ..................................................................................... 15

4. Proposed methodology ............................................................................................. 17

4.1 Research Design ................................................................................................. 17

4.2 Population and Sampling Design ......................................................................... 18

4.3Sampling Design ................................................................................................... 18

5. Timescale .................................................................................................................. 20

6. Resources ................................................................................................................. 21

7. References ................................................................................................................ 22

Page 3: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 3

1. Background of the study (Literature Review)

The need for development that saw the Kenya develop several strategies and plans

such as the vision 2030 and the millennium development goals has led to development

of the finance sector. The need for financing of the development projects has developed

microfinance institutions in the country. Microfinance has received a lot of attention

since its inception in the early 1970s perhaps, as argued by (Okio credit, 2005: 30-32)

Because of the ability of microfinance to reduce poverty alleviation and enhance

economic development by providing credit and savings services to those people earning

low incomes. The attention has seen development of different definitions to

microfinance.

Otero, (1999: 8) says in essence that microfinance is ‘the provision of financial services

to low-income poor and very poor self-employed people’.

Schreiner and Colombet, (2001) on the other hand define microfinance as ‘the attempt

to improve access to small deposits and small loans for poor households neglected by

banks.’ Independent of the definition provided to microfinance it is a general agreement

in the economic field that micro financing alleviates economic development. The money

or funds that are provided by microfinance institutions in terms of credit and micro loans

enables those who are poor to invest into productive acitivities that are bound to earn

them income helping them boost their economic level and alleviate poverty in the entire

economy.

Microfinance institutions therefore are an opportunity for sustainable development. The

extent opportunities available to generate income and the ability of citizens to respond

Page 4: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 4

to the available opportunities are to a large extent determined by the degree or ability to

access financial services that are affordable. Microfinance being able to provide such

financial services is being pursued by every economy worldwide. Initially microfinance

aimed at providing donor finances and financing experimental projects. This has

developed to financial institutions that provide a wide range of services and several

routes to opportunities that are significant for economic development and expansion

(Khan, 2005: 131-142).

The concept of microfinance in most instances has been used interchangeably with

microcredit imploring that they have the same meaning. However microcredit and

microfinance are two different concepts. In an attempt to explain the difference between

microcredit and microfinance.

Sinha, (1998: 2) states that, “microcredit refers to small loans, whereas microfinance is

appropriate where non-governmental organizations (NGOs) and microfinance

institutions (MFIs) supplement the loans with other financial services (savings,

insurance, etc.)”. This definition indicates that microcredit is part of microfinance since it

involves providing credit to the poor. Microfinance is an overall concept as it involves

both credit and non-credit financial services such as insurance, savings, pensions and

other payment services.

Microfinance institutions, given the nature of their objective of ensuring that the prop are

able to access financial services, operate in several models. The most commonly

identified models of operations of microfinance institutions include the Rotating Savings

and Credit Association (ROSCAs), the Grameen Bank and the Village Banking models.

Page 5: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 5

Rotating Savings and Credit Association are formed when a group of individuals come

together and form an agreement to make regular cyclical contributions with an aim of

developing to a common fund. After some period of specified time the lump sum of the

contributions is given to one member of the group in each cycle.

Schreiner, (2010: 112-119), argues that this model is a very common form of savings

and credit.

The solidarity group model is based on based on group peer pressure. Loans are made

available to individuals who are in organized groups of four to seven peoples

(Berenbach, Shari and Guzman, 1994)

The advantage of being in groups is that the members collectively guarantee loan

repayment. They are therefore able to access subsequent loans depending on

successful repayment by all group members. These payments are usually made after a

specific period of time, usually one week (Ledgerwood, 1999: 137).

This model of micro financing is the most commonly used by banks. It has proven to be

more effective in the long run as there are few loan defaulters as each member of the

group is a guarantor of the other.

Berenbach et al, (1994) argues that, ‘solidarity groups have proved effective in deterring

defaults as evidenced by loan repayment rates attained by organizations’.

Village banking model are based on village banks which are normally community-

managed. The banks are established and managed by credit and savings associations

Page 6: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 6

established by NGOs to provide access to financial services, build community self-help

groups, and help members accumulate savings (Schreiner, 2003: 118–136).

This is perhaps the oldest model of micro financing, considering their formation in the

mid-1980s. Usually these village banks normally consist of 25 to 50 members who

majorly low-income earning individuals are seeking to improve their lives through self-

employment activities.

In Kenya, the need for economic development has seen the development of micro

finance institutions which in normal cases start as Chamas. Chamas are small groups

of individuals, who come together, collect money in a pool through continuous

contributions with an aim of accomplishing an investment objective.

(Onumah, 2002) opine that the development of Chamas has led to the development of

banks in Kenya.

For example, equity bank developed from a micro finance institution where its major

purpose was to help customers get mortgage loans for individuals who are low income

earners in the society. It was initiated as equity building society (Coetzee, Kamau and

Andrew, 2003).

There has been other current deposit taking microfinance institutions in Kenya such as

Rafiki and Jammii Bora who are also in the same path.

The rapid development of micro finance institutions in Kenya has helped the country

develop economically with the current rate standing at 5% improvement annually

(CGAP, 2004).

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By Fred M’mbololo Page 7

This has shown that there are several impacts of the financial institutions to the

economy. There are also business that were majorly part of the institutions that have

flopped in the economy. Independent of the connection of economic development to

these financial institutions many Kenyans residents are not members of the

microfinance institutions, let alone being aware of their existence (Kodhek, 2003).

It is in line with this background that the study wishes to determine the level of

awareness and impact on microfinance institutions among the residents of Nairobi

County.

1.1 Statement of the problem

Microfinance institutions have been identified to be the major component to economic

development. In her study on Rural Financial Services in Kenya: What is Working and

Why?

(Betty, 2006) possess that micro financing institutions have in a large extent helped the

development of the Kenyan rural community; “microfinance institutions will continue

serving the rural people and will transform themselves into community based micro-

credit units. This will most likely reduce unemployment in the rural areas”. Development

practitioners and policy makers have as well identified efficient microfinance services as

important for a variety of reasons; helping the poor manage their risks, build their

assets, enhance their income earning capacity, be able to develop small enterprises to

generate income, and these in turn will ensure improved life. Microfinance has also

positive impacts on poverty alleviation and specific economic indicators such as

nutrition status, women empowerment and children schooling.

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By Fred M’mbololo Page 8

Despite the several merits attributed to micro financial services, the level of poverty in

Kenya is still high with 40% of Kenyans leaving below a dollar, businesses are

performing poorly and this is indicated by the slow economic development of below 5%,

many Kenyans are still not members of any microfinance institution. This may be

attributed to lack of information on the positive impacts of micro financing and the lack

of awareness by the general public on the existence of microfinance institutions and the

services such institutions offer.

Few studies have been done in Kenya revolving around microfinance. However none of

these studies provide direct information on the impacts of microfinance institutions in

Kenya.

(Mjomba, 2011) studied the development of micro-finance in Kenya by specifically

considering micro finance on financial empowerment of women in Kenya. This study

though identified the impact of micro financing as empowering women positively, it

majored on Kenya Women Finance Trust and was also bias to women only. Therefore it

lacked evidence on other impacts of microfinances in Kenya.

(Joy, 2007) carried out a similar study majoring on the impact of microfinance on rural

development with a setting of Makueni County. Although this study was a great

milestone to the studies on the field of impact of micro financing services, it narrowed

down to poor households, income and poverty eradication. The setting was also rural.

This study therefore lacks enough evidence to ascertain the awareness and impacts of

microfinance in Kenya. Therefore, we remain unable to judge the validity of this

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By Fred M’mbololo Page 9

tentative explanation. That is, there remains insufficient empirical evidence to assess

this claim.

Several questions therefore remain unanswered. Who largely benefit from micro

financing services? What is the level of awareness of microfinance services in Kenya?

What are the impacts of microfinance in Kenya? What strategies are employed by

microfinance institutions to ensure they meet their objectives? What kinds of policy

questions do these findings raise for microfinance institutions and for national

government?

This study proposes to interrogate the data that will be collected in residents of Nairobi

County in relation to these broad questions that are emerging around the issue of

awareness and impacts of microfinance in Kenya, and suggests areas of purposeful

focus for policy attention.

1.2 Conceptual Framework

The literature review in this study will cover the previous studies that have been done on

microfinance and its effects. However there will be need to have a clear understanding

on microfinance which will call for concise definition to microfinance concepts such as

microfinance itself, microfinance institutions, economic development and SACCOs.

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By Fred M’mbololo Page 10

Conceptual framework

Levels of impact Types of Impact Impact variable/indicator

Household

Community

Economic

Social

Economic variables

Income

Access to food

Household assets

Housing

Human capital

Skills

Education

Health

Empowerment

Confidence

Social capital

Social networks

Social mobility

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2. Industry background

The study will be carried out in Nairobi County. The respondents shall include the

Nairobi County residents. Data will be collected from the Nairobi residents who form the

population of this study, with an aim of determining their level of awareness to

microfinance in Kenya and the impacts of microfinance in Kenya.

2.1 Significance of the study

To the government

In line with the ability of micro financing services to ensure economic development by

providing savings and credit to low income earners, the government has been pushed

to support the development of microfinance institutions. This has seen a lot of

investment by the government in providing financial support to the microfinance

institutions. The information from this study on the impact of microfinance may help the

government in determining the viability of their investments.

Microfinance institution’s management

The microfinance institutions are formed with the objective of ensuring that low income

earners have access to financial services. There are several Kenyans who fall under the

bracket of low income earners. Microfinance institutions aim at ensuring that all these

citizens who are low income earners are catered for in terms of provision of financial

services. It is therefore necessary for the institutions to understand the perceptions of

the citizens on the impact of the microfinance services they are offering and the level of

awareness of the public on the existence of microfinance institutions and their services.

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By Fred M’mbololo Page 12

This information may be used by the management of the microfinance institutions in

determining areas for improvement so as to ensure their success.

Academicians/ researchers

Little research has been done in sub-Saharan Africa to directly identify the impacts of

microfinance. Considering the benefits attributed to microfinance institutions in

economic development and the rapid development of these institutions, impact of

microfinance has received attention of researchers and academicians. Therefore a

study on the awareness and the impact of microfinance in Kenya, with major focus on

Nairobi County, may therefore attract researchers and academicians who are in need of

educating more and providing solutions to lack of access to financial services in sub-

Saharan Africa.

The information from the study will also form basis for literature for other researchers

and academicians who are willing to carry out studies in the same field in Sub Saharan

Africa. Next, the study will be a starting point for further studies on microfinance in

Kenya.

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By Fred M’mbololo Page 13

3. Research aim, research questions or hypotheses and objectives

3.1 Research Aim

The aim of this study is to determine the level of awareness of microfinance services

and the impacts of microfinance services to residents of Nairobi County. The objective

is to come up with findings that may be used to make assertions on the awareness and

impacts of microfinance in Kenya.

3.2 Research questions

1. What is the level of awareness of Nairobi County residents on microfinance

institutions and the services they offer?

2. What are the impacts of microfinance to Nairobi County residents?

3.3 Hypothesis

1. Nairobi County residents are unaware of microfinance institutions within the

county and the services such institutions offer

2. Microfinance has positive impact to economic and social development of Nairobi

County residents

3.4 Objectives

The specifics objectives of the study shall include

1. To determine the level of awareness to microfinance among Nairobi County

residents

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By Fred M’mbololo Page 14

2. To assess the level of development of microfinance institutions within Nairobi

County

3. To assess the impacts of microfinance to Nairobi County residents

4. To determine the strategies employed by the microfinance institutions in Nairobi

County to meet their objectives

3.5 Assumptions of the study

The researcher makes the following assumptions regarding this study:

1. Respondents will answer the survey questions about the awareness and impacts

of microfinance truthfully.

2. Respondents are familiar enough with the microfinance services to answer the

survey questions.

The researcher expects the entire exercise to move on smoothly relying on the

maximum cooperation of all those who will be involved. That the sample will properly

represent the population, the data collection instruments will have validity and will

measure the desired parameters and that the respondents will truthfully and correctly

answer questions.

3.6 Limitations of the study

Limitations are potential weaknesses or problems with the study identified by the

researcher. The limitations often relate to inadequate measures of variables, loss or

lack of participants, small sample sizes, errors in measurement, and other factors

typically related to data collection and analysis. These limitations are useful to other

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By Fred M’mbololo Page 15

potential researchers who may choose to conduct a similar or replication study

(Creswell, 2005).

The limitations of this study include;

1. The study involved the perception of residents on the impacts of microfinance.

The data will be collected from individuals who are self-reporting their

perceptions.

2. Perceptions of those who participated are not factual information and are biased

based on the respondent’s own experiences and attitudes.

3. The geographical expanse of the study area, inadequate financial resources and

time constraints may also reduce the chances of contacting more respondents.

These limitations will be mitigated by making sure that, there is purposive sample

selection, piloting and careful scrutiny of the perceived parameters of measurement in

the microfinance institution, population and sample.

3.7 Delimitations to the study

Delimitation narrows the scope of the study. The follow were delimitations of this study:

write in prose not points

1. Participation in this study is voluntary.

2. The population was limited to microfinance institutions in Nairobi County

3. Respondents involved in the study were from the same large urban area

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4. There could be other impacts of microfinance that may not be exclusively

addressed in this study.

The study is bound to have a reasonable degree of success because the population

and the sample are readily available in Nairobi County. The use of the SPSS

programme in analyzing the collected data will be helpful in making reasonable

deductions. Some of the respondents’ concerns connected with the impacts of

microfinance will be quantitatively measured and appropriate records made. Such

parameters will include number of people registered with the microfinance institutions

and the number of microfinance institutions within the county.

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By Fred M’mbololo Page 17

4. Proposed methodology

4.1 Research Design

A cross-sectional descriptive research design will used in this study to investigate the

impacts of microfinance in Kenya and the awareness of Kenyans on the microfinance

institutions and their services. This design will be employed because data will be

collected once.

(Lokesh, 1984) insists that ‘descriptive research is designed to obtain pertinent and

precise information status of the phenomena’.

(Creswell, 2003) emphasize that ‘descriptive designs are used in preliminary and

exploratory studies to allow the researcher to gather information, summarize, present

and interpret for the purpose of classification.’ Descriptive research will be used in this

study to obtain information on the current status of impacts of microfinance in Kenya so

as to describe what exists with respect to variables or conditions in the situation of

access to financial services in Kenya. Descriptive statistics will mainly be used in this

study to describe information or the data collected through the use of numbers.

(Blaikie, 2000) argues that the characteristics of groups of numbers representing

information or data are called descriptive statistics.

The cross sectional descriptive design method that will be used in this study therefore

will match the purpose of the study based on the above description of a descriptive

research method. The intention of the study will be to determine the level of awareness

of microfinance services and the impacts of microfinance services to residents of

Nairobi County. The aim is to come up with findings that may be used to make

Page 18: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 18

assertions on the awareness and impacts of microfinance in Kenya. Using descriptive

research design therefore will be to ensure an in depth description of the state of affairs

in the study.

4.2 Population and Sampling Design

Population

(Dornyei, 2007) defines ‘population as those units for which the findings of the survey

are meant’. Data on impact and awareness of microfinance will be collected from

respondents which shall include but not limited to Nairobi County residents.

4.3Sampling Design

Sampling Frame

A sampling frame is a list that constitutes the population. The basic idea of sampling is

that the unit selected represents the population. This means that selecting some of the

element in the population, one can draw conclusions about the entire population.

(Cooper and Schindler, 2006) suggest that ‘the sample frame is a representation of the

element of target population that consist a list of all elements of that population’. In this

study the sample frame shall consist of Nairobi County residents.

Sampling Techniques

Sampling means selecting a group that represents the entire population. Sampling is

considered because it reduces cost and resources that would have been used in

studying the entire population. It makes a study more manageable in terms of resources

and ensures that the objective of the study is covered as well.

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This study will use the simple random sampling techniques in selecting the sample of

respondents who took part in the study. Respondents will then be selected randomly

from each stratum. The strata were frontier, emerging and developed banks in Kenya.

Page 20: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 20

5. Timescale of Activities

Calendar Week Activities

1st week of October ,

2013 Design a chapter structure for the research project including a table of contents, a draft of the abstract, keywords, preface, and Introduction of the study

2nd

week of October, 2013

Review the Introduction, design questionnaire and plan how to carry out sampling on certain institutions.

3rd

week of October, 2013

Strategize on how to fill in the gaps in the Literature review by gathering more literature on microfinances. Submit my proposal to the supervisor for review

4th week of October,

2013 Incorporate the feedback received and Send out the questionnaire and follow up for answers and tabulate the results

1st week of November,

2013 Carry out personal interviews, analyze the results of the questionnaire and interviews

2nd

week of November, 2013

Perform analysis on secondary and primary data already gathered.

3rd

week of November, 2013

Write up a draft of the dissertation excluding the conclusion chapter.

4th week of November,

2013 Begin drafting out the conclusions of the findings

1st week of December,

2013 Complete the final version of the main chapters excluding conclusions.

2nd

week of December, 2013

Start writing up the entire dissertation including the conclusion chapter.

3rd

week of December, 2013

Review the entire dissertation and suggest recommendations from the study and suggest areas which need further research.

4th week of December,

2013 Include the Bibliography and ensure that Harvard Referencing system is used. Check for grammar, spelling and syntax.

1st week of January,

2014 and beyond

Compile the entire dissertation report, allowing for any lapses in the schedule of activities and submit it for marking.

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By Fred M’mbololo Page 21

6. Resources

I will need to get references from secondary data particularly from journals and

textbooks (accounting models and concepts), papers from meetings, as for primary data

I will get these from the businesses, internet and the tax offices.

I will need time and some money to do the fieldwork for the purpose of gathering the

relevant data through cross-sectional descriptive research design and sampling.

A list of resources to be used as per the 7 -References shown below;

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7. References

Books

1. Berenbach, Shari, and Guzman D. (1994). The Solidarity Group Experience

Worldwide in The New World of Microenterprise Finance, edited by M. Otero

and E. Rhyne. Kumarian Press, West Hartford CT: 119-139

2. Berenbach, et al, (1994). The Solidarity Group Experience Worldwide in The

New World of Microenterprise Finance, edited by M. Otero and E. Rhyne.

Kumarian Press, West Hartford CT: 119-139

3. Blaikie, N. W. H. (2000). Designing social research: the logic of anticipation.

Cambridge

4. Creswell, J. W. (2003). Research design: A qualitative, quantitative, and mixed

method approaches (2nd Ed.). Thousand Oaks, Calif.: Sage Publications.

5. Creswell, J. W. (2005). Educational research: Planning, conducting, and

evaluating quantitative and qualitative research (2nd Ed.). Upper Saddle River,

NJ: Pearson.

6. Dornyei, Z. (2007). Research methods in applied linguistics. New York: Oxford

University Press

7. Khan, B.H. (2005). Managing e-learning: Design, delivery, implementation

and evaluation. Hershey, PA: Idea Group Publishing

8. Ledgerwood, J. (1999), Microfinance handbook: An institutional and financial

perspective, the World Bank publications, USA

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By Fred M’mbololo Page 23

9. .Lokesh K (1984). Methodology of educational research. New Delhi. Vikas

Publishing Pvt Ltd

10. Okio credit (2005) Noncredit financial services and Micro credit in Nigeria, a

textbook, 2nd edition, pages 131-142, Bolubestway Press limited, Nigeria

11. .Otero, M., (1999). The New World of Micro Enterprise Finance, Kumarion

Press, W. Hartford, CT

12. Schreiner, M.; and Colombet H. (2001) Microfinance, Regulation, and

Uncollateralized Loans to Small Producers in Argentina, pp. 137–152 in

Douglas R. Snow, Terry Buss, and Gary Woller (eds) Microcredit and

Development Policy, Nova Science Publishers: Huntington, NY, ISBN 1–

59033–001–3.

Thesis

1. Betty K (2006). Rural Financial Services in Kenya What is working and Why?

Inaugural dissertation, Egerton University.

2. Joy M. The impact of microfinance on rural poor households’ income and

vulnerability to poverty: case study of Makueni District, Kenya. PhD Thesis,

University of Nairobi. Kenya. Published

3. Khan, F. (2005). Microfinance and Development, Master’s Thesis, Umeå School

of Business and Economics (USBE), Sweden.

4. Mjomba E (2011) Micro-finance and financial empowerment of women in Kenya.

PhD Thesis, University of Nairobi. Unpublished.

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Journals

1. Schreiner M. (2010). Seven Extremely Simple Poverty Scorecards, Enterprise

Development and Microfinance, Vol. 21, No. 2, pp. 118–136.

2. Sinha H. (1998) Microcredit: impact, targeting and sustainability. IDS Bulletin,

volume 29, issue n°4.

Papers

1. CGAP (2004). Scaling up poverty reduction: Case study for Microfinance.

Washington, D.C. World Bank Financial Sector Network.

2. Graheem Bank (2000). Annual report on of the Grameen Bank, Bangladesh,

Dhaka.

3. Kodhek, G.A. (2003). Feast and Famine: Financial Services for Rural Kenya,

Working Paper, Tegemeo Institute of Agricultural Policy and Development.

4. Onumah G.E. (2002).Improving access to rural finance though regulated

warehouse receipts systems in Africa. A case study paper presented at an

international conference on best practice”. Malden, MA. Polity Press. Blackwell

5. Schreiner, M. (2003) The Performance of Subsidized Microfinance

Organizations— BancoSol of Bolivia and the Grameen Bank of Bangladesh,

Lewiston, NY: Edwin Mellen Press, ISBN 0–7734–6730–0

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Online sources

1. Brennan, D. (2008). One mission, myriad benefits from microfinance institutions.

Microfinance Reviews. Available at: http://nuwireinvestor.com /articles/

microfinance-institution-reviews-51486aspx. (Accessed on 03/08/2013).

2. Coetzee, G., Kamau K., and Andrew, N. (2003). Taking Banking Services to the

People: Equity’s Mobile Banking Unit. Nairobi, Kenya: MicroSave.

www.seepnetwork.org/files/2084_Equity_Mobile_Banking_Unit_Coetzee_et_al.1.

doc

3. United Nations. (2005). Building inclusive financial sectors to achieve the

millennium development goals. Available at:

www.internationalyearofmicrocredit2005.com . (Accessed on 03/08/2013).

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APPENDIX: QUESTIONNAIRE

General Questions

1. What is your gender?

a) Male [ ]

b) Female [ ]

2. Your age is between

a) 18-35 [ ]

b) 36-45 [ ]

c) 46-60 [ ]

d) Above 60 [ ]

3. Where do you work?

a) Employment [ ]

b) Farming [ ]

c) Trading [ ]

d) Artisan works [ ]

e) Others (Please specify)………………………..

4. Have you ever applied for a loan (“borrowed capital”) to finance your business?

a) Yes [ ]

b) No [ ]

If yes where?

a) Microfinance institution [ ]

b) Bank [ ]

c) others (specify)………………………….

Level of awareness of microfinance

5. What is the name of your microfinance institution?

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6. Do you obtain financial services from any other microfinance institution?

a) Yes [ ]

b) No [ ]

7. Overall satisfaction with service provided by your microfinance institution?

a) Very dissatisfied [ ]

b) Dissatisfied [ ]

c) Neutral [ ]

d) Satisfied [ ]

e) Very satisfied [ ]

8. Observed service improvement in your microfinance institution in past 5 months?

a) Much better [ ]

b) Slightly better [ ]

c) Almost same [ ]

d) Slightly worse [ ]

e) Much worse [ ]

Level of development of microfinance institutions

9. In your last visit to your microfinance, how do you agree with the following? where (5-Strongly

agree, 4-Agree, 3-Neutral, 2-Disagree and 1-Strngly disagree)

1 2 3 4 5

a) I was served on a first come basis

b) The service providers displayed name tags

c) I was addressed by my name

d) The service provider made eye contact

e) I was greeted by the provider

f) The service provider smiled at me

g) I am very satisfied with counter satisfaction

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By Fred M’mbololo Page 28

Impacts of microfinance

10. If you have ever applied for a loan for your business from microfinance, please rate the following

statements. (5-Strongly agree, 4-Agree, 3-Neutral, 2-Disagree and 1-Strngly disagree)

11. How do you agree with the following statements about your microfinance? (5-Strongly agree, 4-

Agree, 3-Neutral, 2-Disagree and 1-Strngly disagree)

Strategies employed by the microfinance institutions

1 2 3 4 5

a) It was easy to be given a loan

b) The criteria used by MFI in offering loans is fair

c) The criteria used by MFI is easy to be met

d) I would conclude that MFI has helped me in developing my business

e) I would like to obtain another loan if need be from MFI

f) Am happy with loan repayment conditions given

g) Interest rate offered was fair

1 2 3 4 5

d) The organization has a structured way of evaluating training.

e) Customers do value training they receive in this organization

f) Training done to this organization is geared towards meeting customer

needs

g) After training, the organization is geared towards meeting cutomer needs

h) Within the organization there is an enabling environment for transfer of

training to thrive

i) There is reliable or efficient service at the counter (dependable for

solutions)

j) Friendliness of the counter staff (approachable for solutions)

a) Before any loan is given this organization conducts analysis of the viability

of the business

b) Business analysis done for customers is informed by organization

objectives

c) Trainings are provided to customers geared towards increasing their

knowledge on available products and services

k) Politeness of the counter staff

e) Reasonable total time taken to complete a transaction

f) Staff knowledge of products and services

Page 29: A research proposal on the Impacts of Microfinance in Kenya

By Fred M’mbololo Page 29

12. How important are the following statements in relation to MFI? (5-Most important, 4-Important, 3-

Neutral, 2-Not important and 1-Not important at all)

1 2 3 4 5

g) Efficient telephone services

h) Ability of branch to solve errors and complaints

i) Staff addressing you by name

j) Publication of service charges

e) Having information on products and services available

a) Being greeted by friendly and courteous staff

b) Receiving quick and efficient counter service

c) Having a clean and tidy environment

d) Having staff available to answer questions

f) Privacy for discussing private matters