Microfinance Lending and Women Empowerment in Nakuru County Informal Settlement in Kenya
DOI:
https://doi.org/10.53819/81018102t2528Abstract
This study examined the impact of microfinance lending on women empowerment in Nakuru County informal settlements, Kenya, focusing on four microfinance service components: institutional lending services, saving services, microinsurance services, and financial training. The study adopted a descriptive survey design targeting women aged 18-60 years residing in informal settlements who were current or potential beneficiaries of microfinance services. From a target population of 400 women, a sample of 200 respondents was selected using purposive sampling, achieving a 93.0% response rate with 186 completed questionnaires. Data was collected using structured questionnaires with a 5-point Likert scale and analyzed using descriptive and inferential statistics including Pearson correlation and multiple regression analysis. The results revealed that all microfinance services had significant positive relationships with women empowerment, with lending services showing the strongest correlation (r = 0.779), followed by saving services (r = 0.776), microinsurance services (r = 0.768), and financial training (r = 0.732). The regression model demonstrated substantial explanatory power (R² = 0.723, F = 118.033, p < 0.05), with lending services being the strongest predictor of women empowerment (β = 0.275), followed by saving services (β = 0.245), microinsurance services (β = 0.244), and financial training (β = 0.180). The study concluded that microfinance services significantly contribute to women empowerment, though challenges exist regarding affordability and accessibility, recommending that microfinance institutions redesign products, strengthen financial literacy programs, improve microinsurance awareness, and expand training availability.
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