KARDS Training on Micro Finance and Micro Enterprise Development

KARDS Development Consultants will commence a training on Micro Finance and Micro Enterprise Development (MF&MED)
Program Duration
5 Days, Mon. 4, July 2011 – Friday 8, July 2011 (8.30am – 4.00pm)
Shalom House, St. Daniel Comboni Rd., Off Ngong’ Rd.
Program Output
This program aim to enhance the participants ability to develop effective interventions and promotional strategies for the small micro enterprise sectors. Based on the premise that MFIs have to be sustainable for long term impact, and that sound accounting principles are one of the pillars of financial well being of micro finance.
Training Program Outline
  •  Overview of micro finance and its evolution
  • The role of MFI’s as an essential tool in promoting SME’s
  • Feasibility study for micro finance
  •  Initiating and designing micro finance programs
  • Portfolio management.
  •  Experiences in developing micro finance institutions
  • Impact assessment
  • Promotion and development of micro enterprise
  • Institutional sustainability and operational efficiency
  • Financial sustainability.
  • Challenges in the micro finance sector; the micro finance act
  • The Role of ICT in micro finance
  • Gender mainstreaming in entrepreneurial development
A fee of Ksh. 9,500 is charged per participant, this is inclusive of professional fee, meals and certificates.
Accommodation can only be pre-arranged on timely request.
About us
KARDS Development Consultants is a community based consultancy inaugurated in the year 2002 and is geared towards the socio economic empowerment of the humble and the lowly in Africa. It embraces its mission of empowerment through provision of training, applied research and consultancy services.
Organization  Address
P.O. Box 16139 00100
Nairobi, Kenya
Working Hours
8am – 5pm, Mon. – Frid.
9am – 1pm Saturday
Tel. Nos. (+254) (20) 3877553, 0720 812 638, 0736 935 387



Factors Influencing the Establishment of Micro-finance Schemes in Kenya

This study on Micro Finance in Kenya was a  conducted and published in 2002. While some of its findings have been passed by events, many of it’s findings are very valid for the micro finance sector in Kenya today. Dowload the rest of the study here

Factors Influencing the Establishment of Micro-finance Schemes in Kenya


Dr. George Ondego K’Aol and Richard Ochanda

United States International University – Africa (USIU-A), P.O Box 14634 Nairobi, Kenya

Telephone 254-2-3606000, Fax 254-2-3606100, E-mail gkaol@usiu.ac.ke


Small Business Institute Journal, 2002


The purpose of this study was to determine the major factors that influence the establishment and sustainability of micro finance schemes in Kenya. The study was guided by the following research questions: (1) What policies regulate micro finance Schemes in Kenya? (2) What are the major implementation issues affecting micro finance schemes in Kenya? (3) What are the major factors affecting the sustainability of micro finance schemes in Kenya?

Primary data were collected from thirty micro-finance institutions in Nairobi, Kenya. The institutions included Kenya Women Finance Trust (KWFT), Faulu Kenya, Pride-Africa and Kenya Rural Enterprise Program (K-REP) among others. Structured questionnaires were administered to the managers and the program administrators in these institutions.

The findings of this study revealed that there were no clear policies regulating micro finance institutions (MFIs) in Kenya. The findings indicated that most micro finance institutions were registered under different Acts of Parliament. The findings also revealed that some of the MFIs had more than one registration while others had not been registered at all. On implementation issues, the results indicated that the most commonly implemented MFI design was the solidarity group. However, few MFIs were extending loans to individuals. Most MFIs were taking deposits to cushion the risks associated with non-repayment of loans. With regard to sustainability, the study revealed that there were a few MFIs which had attained financial sustainability as a result of their sound financial cost control and provision of quality portfolios. However, a number of MFIs had not attained financial sustainability and were relying on subsidies from donors.

More than Sh300m in women funds lying idle with lenders

A jua Kali artisan busy at work at Burma Jua-kali in Nakuru. About 23 per cent of money meant for loans to businesswomen remain unutilised with lending institutions. Photo/FILE

A jua Kali artisan busy at work at Burma Jua-kali in Nakuru. About 23 per cent of money meant for loans to businesswomen remain unutilised with lending institutions. Photo/FILE

Nation By WINFRED KAGWE wkagwe@ke.nationmedia.com

More than Sh300 million allocated to the Women Enterprise Fund to be taken as loans is sitting idle in constituency and microfinance institution vaults.

Out of Sh1.5 billion allocated to the fund since its inception in 2009, only Sh1.15 billion has been lent to business women, leaving over 23 per cent unutilised.

The constituency channel of disbursement shows worse performance as over 33 per cent of funds have not reached the target, because out of the Sh465 million allocated, only Sh308 million has been loaned out.

The MFIs, which received a larger share of the funds for on-lending to the tune of Sh1.032 billion and charge 8 per cent interest on loans, have been able to dispense Sh842 million, or over 80 per cent.

“The gaps between allocation and amount disbursed under C-WES (Constituency Women Enterprise Scheme) and MFIs is attributed to differences in absorption capacities of women in various constituencies,” says Mr Wainaina wa Njeri, the CEO of the Women Enterprise Fund.

He adds that 45 MFIs have fulfilled its on-lending conditions. There have been complaints over lack of information on where to get the funds, especially among rural women.

The gaps between allocated and disbursed amounts is wider in some areas like North Eastern and Eastern provinces, according to a report by the Fund.

For instance, out of Sh22 million allocated to the North Eastern Province less that half (Sh9 million) was taken up.

A similar situation is Eastern Province where out of Sh80 million, only Sh40 million was borrowed compared to other areas like Nairobi where uptake is over 80 per cent.

The fund cites strong attitudes, cultural and religious beliefs in disbursing money in different parts of the country as hindrances.

“Gaps are obviously bigger in North Eastern and Eastern provinces because the Muslim faith is against interest on loans,” he says.

“Although the money to registered groups under C-WES is interest free, we have very few MFI partners in those areas and generally, the fear of loans by women,” says Mr Wainaina.

The revolving fund was initiated in 2009 to provide sustainable solutions to the challenges Kenyan women face in venturing into or expanding their businesses.

For a while, the fund was blemished by high default rates – currently at 30 per cent – attributed to misinformation and interference by politicians, who told women that the loans were free government money not to be repaid.

“Under C-WES a total of Sh130million has been recovered. We have recorded a loan repayment rate of over 70 per cent. There is no default from the MFIs,” says Mr Wainaina.

The fund advances the money to MFI to revolve over a period of three years through lending to women groups.

So far, over 6000 groups have accessed loans.

Women fail to repay loans

East African Standard By Vitalis Kimutai 5th February 2011

Forty women groups in Uasin Gishu County have defaulted in repayment of Sh3.1 million advanced to them by the Government through the Women Enterprise Fund (WEF).

In Eldoret South, 21 women groups have failed to repay Sh1 million which they received in 2008 while 19 groups in Eldoret North have not repaid Sh2.1 million advanced to them.

“Women groups in Eldoret South repaid Sh81,000 while those in Eldoret North repaid Sh204,000,” Stanley Wainaina, the chief executive officer of WEF, said.

Mr Wainaina said Eldoret East constituency had some of the best performing women groups under the fund and asked those from neighbouring constituencies to borrow a leaf from them.

Money used well

“Out of the Sh2 million which 43 groups in Eldoret East were allocated, they have repaid Sh1.1 million. None has defaulted. It is encouraging to note the groups have put the money into good use and are able to repay on time,” Wainaina said at Eldoret Municipal Council Hall when Gender Minister Naomi Shaban and Permanent Secretary James Nyikal held a meeting with members of various self-help groups in the area.

He said 19 more groups in the constituency have applied to be allocated Sh1 million. He said the money would soon be released to the groups.

Dr Shaban told women and youths to join cooperative societies and get loans to start various businesses and uplift their standards of living. She said youths from vulnerable backgrounds would be given priority in enlistment to the National Youth Service. The minister said Sh400 million had been set aside as grants to the disabled to assist them start income generating projects.

Prof Jackline Oduor, the secretary children’s affairs, Prof Collette Suda the secretary gender and social development, the director, Deputy Chief Economist Esther Ndirangu and Eastern Rift Valley Regional Deputy Provincial Commissioner Wanyama Musiambo accompanied the minister.

Prof Odour said children’s homes that do not meet the set standards would be closed.

Micro Finance and Micro Enterprise Development

KARDS Development Consultants

Strategic Community Development Centre

September 6 to September 10 2010 at Shalom House, St. Daniel Comboni Rd , Off Ng’ong Rd , Nairobi .

KARDS Development Consultants will commence a training program on Micro Finance and Micro Enterprise Development (MF&MED)

Based on the premise that MFIs have to be sustainable for long term impact, and that sound accounting principles are one of the pillars of financial well being of micro finance the program aims to enhance the participant’s ability to develop effective interventions and promotional strategies for the small and Micro Enterprise sectors.

Program Design and Schedule

The MF and MED program lasts for five days and is divided into three sessions per day.

Morning session (8:30am – 10:30am), followed by a 30 Minute coffee break

Mid morning session (11:00am – 1:00pm), followed by a 1 Hour lunch

Afternoon session (2:00pm – 4:30pm)

Why Attend?

Learn proven and cutting edge micro finance techniques that will facilitate provision of service to clients.

Develop management skills that will assist you to administer institutional practices effectively and efficiently.

Another great concern for any social actor centers on the desire to reduce susceptibility to vulnerability and exploitation amongst the poor by adopting a preventive approach!

Program Outline

Overview of micro finance and its evolution.

The role of MFI’s as an essential tool in promoting SME’s.

Feasibility study for micro finance.

Initiating and designing micro finance programs

Portfolio management.

Experiences in developing micro finance institutions.

Impact assessment

Promotion and development of micro enterprises

Institutional sustainability and operational efficiency.

Financial sustainability.

Challenges in the micro finance sector; the micro finance act.

The Role of ICT in micro finance.

Gender mainstreaming in entrepreneurial development.

Methodology: The Training Program on MF and MED will be conducted in a participatory way by using methods like lectures, participatory discussion, group discussions and case studies, The experiences of the participants will be used during adaptation of these methods.

Participation Fee: KES 9,000 is charged per participant. (inclusive of training materials, meals and certificates).

For any further information on the MF &MED program, please contact us at;

Email: info@kardsafrica.org or Kards_Koinonia@yahoo.com;

Tel. Nos. (+254) (20) 3877553, 0720 812 638, 0736 935 387

Web site: www.kardsafrica.org

Part II: Small Micro finance Institutions Survival: Case of Employment and Enterprise Program

Richard Ochanda, Paul Kisolo, Nicholas Omondi and Bernard Ndubi

The resource dependence approach argues that the key to organizational survival is the ability to acquire and maintain resources (Sheppard, 1995). There are a variety of ways in which a firm can ensure the supply of resources critical to its survival. The resource dependence has been developed with the perspective of a) ensuring firm operates profitably, grows and is stable b) improving the firm’s ability to control resources c) ensuring that the firm has influence over critical resource providers d) buffering through diversification and lastly d) ensuring optimal usage of present level of firm resources. Hence to acquire resources, an organization must enter into exchange relationships with others so as to affect its survival through the management of demands from different interest groups upon which the organization depends for resources (Pferrer and Salancik, 1978). Resource dependence therefore suggests a variety of ways in which an organization can ultimately ensure the supply of resources critical to its survival. It is therefore a logical assumption that failed firms would have properly utilized fewer of these resources than surviving firms.

In the light of the above arguments, many micro finance organizations face survival dilemma. It suffices to say that some micro finance institutions suffer from problem of age and past practices that has made them inflexible to respond to the dynamic and changing environments. Micro finance organizations should not only focus on the individual clients but also consider creating products for organized producer groups and help them explore linkages to markets. Secondly the resource based approach on the other hand also advices that programs should contain negative demands of some of their claimants. Most institutions however are overwhelmed by some of these demands and hence their survival chances are endangered.

Third the problem of most institutions is smallness. With this smallness they cannot be able to manoeuvre as required or even to attract resources in terms of grants or soft loans. Organizations hence end up depleting their capital by financing their operational expenses hence become unable in the long run to issue credit to their clients. Clients are always keen to protect their money and will ensure that before the worst happens to the program, they have retrieved their savings. A great concern therefore becomes what are the survival chances of many small micro finance institutions given their present operational hardships? The answer depends on individual institution for some it could be “sadly none”, for another it could be “we have survived, so we shall always survive despite the hardships” while for others “they would consider new chances to manoeuver and think out of the box (adopt a fourth dimension).” One golden rule is to ensure a rule based organization and remove all attempts aimed at canvassing the program benefits contrary to the established procedures and policies.

EEP-SACCO too faces all the above dilemmas though its impact to the poorest of the poor remains modest.

Social enterprises such as EEP-SACCO understand in depth the transcendental dignity of the human being. It is always present in the lives of the people; serving, accompanying, empowering and advocating. EEP-SACCO at times works under very difficult conditions such as the 2007 post electoral violence in Kenya, very urban poor clients in the slums, liquidity problems, problems to remunerate its dedicates staff, complete lack of resources etc.  Though it is challenged resource wise it is “part and parcel” of its local communities. Over the years EEP-SACCO has developed tremendous local knowledge, local embededness and local competence on how to empower and accompany the poorest with small credits. Hence EEP-SACCO as a local actor is more “integrated and domestic” and it addresses the “entire universe of the human situation” that exists in its community. The beauty ofEEP-SACCO is in its smallness and its ability to beat all the odds and survive despite the odds of doing so. EEP-SACCO like all Micro finance institutions transcends the “the suffering victim dimension” and enables an individual seeking to break the chains of poverty to become “an empowered survivor.”

Part I: Small Micro finance Institutions Survival: Case of Employment and Enterprise Program

Richard Ochanda, Paul Kisolo, Nicholas Omondi and Bernard Ndubi

Please also visit Social Enterprise Creative Lab

Employment and Enterprise Program (EEP) is a micro finance institution collaborating with the Dagoretti Catholic Parish in Nairobi and serves clients from Kawangware, Riruta and Dagoretti who include mothers of street children, street youth, parish members, refugees, those affected by HIV/AIDS, ex-prisoners and the general public.  Seen in the light of a social enterprise, EEP takes care of four dimensions as it addresses the needs of the urban poor. These dimensions are 1. Financial dimension, 2. Social impact, 3. Environmental impact and last but most important is 4. The spiritual dimension.

A social enterprise is an important component of the social economy that covers the gaps overlooked by the market economy on one side and the public interventions the other. It is a fact that economic growth produces plenty along side poverty (De Soto, 1989). Institutions such as EEP therefore ensure that those who cannot benefit from participating in the market are not locked out of the market all together. Hence the survival of EEP means that the benefits of the market will always continue be extended to the poor, the socially excluded and people at the periphery of the society.

The organization is a myopic but adaptive entity whose survival depends on its ability to perform various activities with greater efficiency than its rivals. It is therefore important for a firm to be aware of various comparative dynamics in the industry and how various specific factors will enhance or diminish its efficiency (Chang M H, 2008).  Literature on organizational dynamics displays a common pattern in which a number of market participants initially rise, then declined with some firms leaving the market (shake out), while those remaining converge to a stable state. Examination of different industries over time found that the organizational output generally grew with time but the rate of growth declined steadily over the course of development with market prices declining over time.

Geroski (1995) succinctly summarized industry dynamics by imputing that entry in any business appears relatively easy but survival is not. On the other hand most entrants into the market start small and end up small (at times smaller than during the entry period). Smaller firms are exposed to high hazard rates. This is because unlike their counterparts who have a size advantage they have less resources (human and capital), less managerial experience, non dynamic tacit knowledge. Such firms are unable to withstand market shocks. Secondly smaller firms have less market power and less ability to endure adversity.  In many service and product markets a larger size confers more influence on the market price, while endurance derives from long-established market niches and brands that insulate the firm’s own market  segment  by reducing its sensitivity to difficulties be it a competitive challenge or otherwise. Older and larger firms are more likely to be diversified and therefore are less susceptible to fluctuations in demand (Kanioviski and Peneder 2007).