A study of the success of micro-finance institutions in poverty reduction: a case of KWFT in Kwale District

Abstract

This study was conducted with the objective to find out if the micro finance institutions were succeeding in their objective of eradicating poverty among women. The KWFT lending programme in Kwale district was the case study. The specific objectives of the study were; To determine the effect of KWFT loans on women's income, savings and purchasing power in K wale District, to establish whether the ability and chances of women in decision-making in homes in Kwale District have increased as a result of KWFT services and to establish and describe the dependency level of women in K wale District before and after receiving the KWFT loans. A sample of 80 women was interviewed. Primary data was collected through personally administered structured questionnaires. The respondents were women entrepreneurs who at one time or another have been lent money by KWFT, and are because of that members of KWFT. The data obtained was coded and fed in the computer and analyzed using SPSS computer package. The data was analyzed in form of frequencies, percentages and cross tabulations. A regression analysis was also run for some of the objectives and a chi-square test of independence was obtained and used to study some objectives. The findings of the study suggested that 98% of the women recorded increase in their business income and 93% recorded increase in their saving rate. The findings also revealed that increase in income and savings is independent of the loans. The results also suggested that the purchasing ability of the women and sales increase was dependent on the loans. The women participated in making decision in their families and their dependency level had improved. The respondents were generally satisfied with KWFT services especially the loans that they were offered. The decision making variable used in this study were independent of the loans except the decision on buying stock for the business which was dependent on the loans. The dependency level variables (collateral ownership and percentage of family expenses the women were able to meet) were found to be dependent on the loans offered by KWFT.