Effect of Progressive Lending Mechanism on Access to Finance in Rural Kenya: A Survey of Masaba North District

Abstract

Rural based women access credit as a group rather than individually and progressively graduate from smaller amounts of credit to higher ones just because they are perceived to lack the essentials that give them a mandate to get the credit. Several studies have been carried out on the performance of microfinance institutions but these studies have up to date neglected the effect of the progressive lending mechanism on the development of the clients especially Women entrepreneurs in terms of borrowing experience. This study sought to establish the effect of progressive lending mechanism on access to credit by women entrepreneurs in rural Kenya. The study adopted descriptive research design. A population of 1200 women entrepreneurs drawn from women enterprise fund members was used. Both closed and open ended questionnaires were used to collect primary data. Secondary data was obtained from periodicals, internet and published journals and books. Data was analyzed both qualitatively and quantitatively and then presented through frequency tables and percentages. Based on these findings, the following recommendations was proposed: the progressive lending mechanism should consider the needs of women entrepreneurs who may require rapid growth as well as allow maximum autonomy to the entrepreneur in order to safe guard their business secrets.