The purpose of the study was to show the relationship between micro finance and pove1iy
reduction and how microfinance has led to reduction of poverty in Kenya. The main or
general objective of the research was:
I. To establish the contribution of micro-finance services in pove1iy reduction in Kenya.
II. To identifY the various micro-finance services offered by micro-finance institutions in
Kenya.. To identifY the problems that hinder micro-finance services in Kenya.
The target population that was accessible was 50 out of the total population of 400 recorded
clients and staff of Nairobi branch, 44 was selected in order to achieve the required sample,
this sample was obtained using slovene's fmmula. Primary data was collected using
questionnaire method administered to staff and clients analyzed through the use of descriptive
statistics and MS Excel and data was presented using tables and pie charts. The sample
population was picked using stratified random sampling. This technique was used because it
provided for inclusion in the sample of the various sub groups in the target population.
The research instrument used were questimmaire where there these were structured and nonstructured
and they aimed at getting all the necessary data from respondents. This method
was used because it is helpful in obtaining specified quantitative and qualitative information
with accuracy and completeness, interviews where the researcher used interviews to acquire
information that was not easily obtained through questionnaires. Interviews were used
because it saves time when the interview schedules are structured and you get the first hand
infom1ation from the respondents and it enabled the researcher to probe more for
clarification, documenta1y review was also used where it involved reading documents related
to clients drop out and microfinance.
The researcher used both the questionnaire and the general objectives to analyze the data,
where he used gender that is both male and female where most of micro finance clients were
female where 61% were women and above 38% were men. This shows that the initial
objective of microfinance institutions of empowe1ing the poor and rural women for selfsustaining
and improve their standard of living, the researcher used mmital status of single,
married, window and divorced to analyze data, age group was also used, education level,
duration in the organization of staff; services offered by microfinance institutions, effect of
microfinance services on poverty reduction and problem that hinder microfinance services,
all based on questionnaire and objectives.
The findings of the study revealed that many people were helped with micro finance services
such as savings, loans, advisory services, insurance services among others. According to the
findings these services helped people of Kenya in increasing their investment in small
businesses which in tum creates their income and later will lead to a better standard ofliving.
The findings of the study also revealed that micro finance services helped people of Kenya in
reducing their level of poverty with over 74% of the respondents agreed though there a
significant proportion is living below the poverty line. The study revealed that microfinance
institution has promoted women's empowerment in the society with 75% such business and
more women become self reliant and they are in position of rum1ing their own business
independently. However, not all women have been in full position of self reliance, thus more
needs to be done since some of the women are still poor. The study also revealed that
microfinance institutions played a big role in linking their clients to the agricultural sector
with over 68% of the respondents agreed by offering them agricultural loans.
Conclusion, microfinance institutions play a major role in reducing povetiy level to a lower
level especially it helps low income households who are the most susceptible to poverty
problems. Microfinance institutions provide services that are regarded impotiant tools in
alleviating poverty such as saving services, loan services, advisory services and insurance
services. There is clear evidence that microfinance services have done a tremendous work in
uplifting people's income and their standard ofliving though there are problems facing
microfinance institutions in their bid to eradicate poverty such as people's inability to offer
collateral security, lack of knowledge of micro finance institutions by the poor and shortage of
funds that would be given to the poor.
The recommendations that were put forward where there is need for micro-finance
institutions to increase the amount ofloan they offer to the society especially the women as it
had been found out by the study that the amount given was not enough to establish viable
enterprises and promote socio-economic development, the government should provide and
maintain the basic infrastructure at reasonable cost to consumers, such as communications, education and roads, there is a need for employment progran1s, Legal and institutional
SSA, R (2021). Microfinance And Poverty Reduction In Selected Microfinance Instutions In Nairobi Kenya. Afribary.com: Retrieved June 24, 2021, from https://afribary.com/works/microfinance-and-poverty-reduction-in-selected-microfinance-instutions-in-nairobi-kenya
Research, SSA. "Microfinance And Poverty Reduction In Selected Microfinance Instutions In Nairobi Kenya" Afribary.com. Afribary.com, 04 Jun. 2021, https://afribary.com/works/microfinance-and-poverty-reduction-in-selected-microfinance-instutions-in-nairobi-kenya . Accessed 24 Jun. 2021.
Research, SSA. "Microfinance And Poverty Reduction In Selected Microfinance Instutions In Nairobi Kenya". Afribary.com, Afribary.com, 04 Jun. 2021. Web. 24 Jun. 2021. < https://afribary.com/works/microfinance-and-poverty-reduction-in-selected-microfinance-instutions-in-nairobi-kenya >.
Research, SSA. "Microfinance And Poverty Reduction In Selected Microfinance Instutions In Nairobi Kenya" Afribary.com (2021). Accessed June 24, 2021. https://afribary.com/works/microfinance-and-poverty-reduction-in-selected-microfinance-instutions-in-nairobi-kenya