Tài liệu Formal and informal institutions’ lending policies and access to credit by small-scale

Formal and informal

institutions’ lending policies and

access to credit by small-scale

enterprises in Kenya:

An empirical assessment

By

Rosemary Atieno

University of Nairobi

AERC Research Paper 111

African Economic Research Consortium, Nairobi

November 2001

© 2001, African Economic Research Consortium.

Published by: The African Economic Research Consortium

P.O. Box 62882

Nairobi, Kenya

Printed by: The Regal Press Kenya, Ltd.

P.O. Box 46116

Nairobi, Kenya

ISBN 9966-944-52-4

Contents

List of abbreviations

List of tables

Acknowledgements

Abstract

1. Introduction 1

2. Problem statement 3

3. Objectives and hypothesis of the study 4

4. Literature review 5

5. Structure and performance of the financial sector in Kenya 13

6. Methodology 20

7. Empirical results 23

8. Conclusions and policy implications 37

References 40

List of abbreviations

ACK Anglican Church of Kenya

ANOVA Analysis of variance

GDP Gross domestic product

ICDC Industrial and Commercial Development Corporation

K-REP Kenya Rural Enterprise Programme

Ksh Kenya shillings

MAGs Mutual assistance groups

NBFIs Non-bank financial institutions

NGOs Non government organisations

POSB Post Office Savings Bank

PRIDE Promotion of Rural Initiatives and Development Enterprises

ROSCAs Rotating savings and credit associations

SACCOs Savings and credit cooperative societies

SCAs Savings and credit associations

SMEs Small and microenterprises

List of tables

1. Distribution of main occupation of respondents 23

2. Selected characteristics of the surveyed entrepreneurs 24

3. Results of t-test for the differences in means between the amounts

applied for and received in both formal and informal credit markets 26

4. Differences between means: Amount of credit from formal and

informal sources 28

5. Differences between means in credit from informal market segments 28

6. Distribution of the use of formal sources for initial and operating

capital 30

7. Formal credit sources used by past and current credit participants 30

8. Distribution of the use of informal sources of finance for initial and

operating capital 32

9. Informal credit sources used by past and current credit participants 32

10. Differences between means of selected characteristics for

credit users and non-users 34

11. Differences between means of selected characteristics

of formal and informal credit users 35

12. Mean values of selected loan aspects by formal and

informal institutions 36