APSP VALIDATION FORUM IN KEBWEZI, MAKUENI, KENYA
APSP is conducting a study on the intersectionality between social protection and access to credit.
- APSP held community validation meetings at Makindu, Kibwezi west sub county, in Makueni county to validate the findings of the study on intersectionality between social protection and access to credit.
- APSP also held a validation meeting for county and national government officers in Wote sub county .
APSP OSIEA PROJECT
APSP through the support of the Open Society Initiative for Eastern Africa (OSIEA is conducting a study on the intersectionality between social protection and access to credit. This is a follow up deep dive study to an initial study on social protection and excluded groups.
Some of the emerging issues from Focused group discussions and validation forums include:
- Women groups are the most successful and seem to have greater cohesion than other groups ( youth, men, Persons with disabilities). It was noted that women have benefitted more from accessing credit mainly through the group lending model. Participants noted that the Women Enterprise Fund has been instrumental in building the capacity of women groups to understand group dynamics before they start borrowing funds. It was also noted that the repayment rate for women is higher than other groups.
- It was noted that women are efficient in paying loans with less default cases than other population groups with a 90% repayment rate.
- Also emerged that women bear the burden of raising children and other family responsibilities. As such they use most of the money they borrow to meet family basic needs and education of children. This means that although the money is borrowed for business purposes, the funds are diverted to meet basic needs.
- It was noted that the youth find the group model very tedious. Due to their stage in life ( looking for jobs and other opportunities) the youth are highly mobile, therefore containing them in a location so that they can access funds through groups is not possible. It emerged that the group members are likely to move to urban areas in search of job opportunities, making it challenging to remain in a group within the same locality.
- Youth prefer accessing credit from digital lenders because of the efficiency in accessing these loans. There is no paperwork involved and the loan is disbursed within a very short time, and directly on the mobile phone. They feel that this is a very convenient process since it is quick, efficient without any physical movement. This is in contrast to the banks and other funds like the Youth Fund, which have bureaucracies and too much paperwork.
- Digital lending has emerged as one of the most convenient ways of accessing loans. Although the interest charged is high, participants feel that the requirements are fair, and it does not make too many demands of the clients. Additionally the convenience of accessing loans at the comfort of your home or workplace, through the phone is lucrative.
- Men prefer individual loans as opposed to the group lending model.
- It was noted that although people take loans supposedly for business development, it emerged that many people spend the loans on basic needs and education of their children. There is need for capacity building in financial literacy to support proper investment of the borrowed funds.
- Chamas or the group lending model is the popular with women while the youth prefer using the digital lending platform. There is limited bureaucracy in the digital lending platforms.
VALIDATION MEETING WITH COUNTY AND NATIONAL GOVERNMENT OFFICIALS IN WOTE SUBCOUNTY,MAKUENI COUNTY ON THE STUDY ON INTERSECTIONALITY BETWEEN SOCIAL PROTECTION AND ACCESS TO CREDIT
Some of the key issues of discussion included:
- Although banks are the most trusted source of credit, very few people go to banks to access credit. It was recommended that banks need to be innovative and reduce bureaucracy and paperwork in providing credit to the public.
- It emerged that access to information on available government funds ( Women enterprise fund, youth fund, National Gender affirmative action funds, among others remains low. There is need for the government to proactively market the products offered by these funds. There is also need for the government funds to partner with community based organizations and faith based organizations to raise awareness on existing funds and products .
- It was noted that although people take loans supposedly for business development, it emerged that many people spend the loans on basic needs and education of their children. There is need for capacity building in financial literacy to support proper investment of the borrowed funds.
- Chamas or the group lending model is the popular with women while the youth prefer using the digital lending platform. There is limited bureaucracy in the digital lending platforms.
- There is need for effective coordination between national and county government programmes.