TABLE OF CONTENTS
DECLARATION .............................. ........................................... iii
APPROVAL ................. ... ........................ .. ........... ..................... iv
DEDICATION..................................................................... ...... v
AKNOWLEDGEMENT ... ............................ ... ............... ..... ...... .... vii
ABSTRACT ............................................... ............................... Vlll
1.0 INTODUCTION
1.1 Background ............................................................................................. 3
1.1.1 Microfinance ................................................................................... 3
1.1.2 Eldoret town ................................................................................... 5
1.1.3 Case study ..................................................................................... 6
1.2 statement ofthe research problem .......................................................... 7
1.3 objective of the research ......................................................................... 8
1.4 importance of the study ......................................................................... 9
1.5 conceptual frames works ...................................................................... 9
2.0 LITERATURE REVIEW
2.1 introductions ............................................................................................ 12
2.2 What are microfinance institutions? ........................................................ 12
2.3 How microfinance help the poor.. ............................................................ 15
2.4 Importance of credit............................................................ 19
2.5 Informal finance usage in Africa ............................................ 20
2.6 Reasons for used of informal finance ....................................... 21
2.7 Characteristics of a good microfinance program ........................... 23
2.8 Importance of microfinance to the poor. ............................ ....... 24
2.9 impact ofmicrofinance to the poor .......................................... 27.
2.10 challenges of micro credit to the poor .................................... 29.
3.0 METHODOLOGY
3.1 research design ......................................................................................... 31
3.2 study population ...................................................................................... 31
3.3 data analysis ............................................................................................ 32
3.4 data processing ........................................................................................ 32
3.5 data presentation ..................................................................................... 32
3.6 limitations ofthe study ........................................................................... 33
4.0 DATA NALYSIS AND PRESENTATION
4.1 Introduction .... ........... ... .. ........................ .......... ....... .... 34
4.2 Percentage ofMFI's members ............................................ 34
4.3 Percentage of capital obtained from MFI's ... ...... .......... .......... 35
4.4 Impact of micro finance to the clients .................................... 36
4.5 Services that benefit client and how? .................................... 36
4.6 The challenges faced by MFI's ......................... ................. 38
4.7 Changes made by MFI's ............................ ... ..... ............... 40
4.8 Services with biggest economic impact ................................. 42
4.9 Factors that discourage people from MFI's ......... ............. ....... 42
4.10 Conclusion .......... .......... ................ .............. ....... .... ..... 44
4.11 Recommendation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45
Bibliography .•......•••.•.•••.............•••.•••...•.••........•........•........• 47
APPENDICES
Appendix A: Questionnaire
Appendix B: CV
Appendix C: Map (geographical)
:Map (street)
Appendix D: time table
Appendix E: Expenses
CHAPTER ONE 1.0 Introduction This chapter has covered the background of the study, the background of the case study, problem statement, research questions, the research objectives, importance of the study and conceptual framework 1.1.1 Background of microfinance To most, microfinance means providing very poor families with very small loans (micro credit) to help them engage in productive activities or grow their tiny businesses. Over time, micro finance has come to include a broader range of services (credit, savings, insurance, etc.) as we have come to realize that the poor and the very poor who lack access to traditional formal financial institutions require a variety of financial products. In the 1970s, experimental programs in Bangladesh based on lending mechanisms extended tiny loans to groups of poor women for investment in micro-business (Hassan, 2002). Remenyi (1997) notes that the most famous of these microfinance programs became the Grameen Bank and the Bangladesh Rural Advance Committee (BRAC), which were both established in the late 1970s as pilot projects. Both were later formalized in the early 1980s, with the Grameen Bank becoming a private sector bank with a limited license, and BRAC becoming a Non-Government Organization (NGO) these two institutions have had a global influence as there have been many successful attempts at replicating them in other developing countries.
