| dc.description.abstract | crediting is the extension of very small loans to impoverished borrowers who typically lack
collateral, steady employment and a verifiable credit history, while a micro enterprise is a type of
small business, often registered, having five or fewer employees and requiring seed capital of not
more than Ksh 2.8M. It will identify the potential benefits for the unemployed and financially
constrained man, the community and the government at large. Drawing from the existing
literature and indicative empirics, it examines the conditions that would facilitate success of
micro crediting for Small business in Kenya.
The underlying objective is to show that micro-crediting can assist create a
source employment for the jobless by giving them capital to start their small- medium
enterprises. To show that micro-crediting encourages independence and self-sufficiency since
now more people can create their own source oflivelihood; they don't have to rely on hand outs
and aids. The project also aims to show that micro crediting can contribute to 'vision 2030.'
There has been an increase in the amount of loans taken up since the introduction
of micro- financing. From 2006, there has been an upward trend in borrowing. The more people
take up loans to start small enterprises; this is helping create informal jobs amidst the crowding
in the formal job sector. A greater percentage of the population now does not have to rely on
hand outs or aids as they can now provide at least their basic needs. With more people having
their businesses, the nation is headed closer to achieve 'vision 2030', as the poverty levels are
decreasing while industrialization being on the rise. The Commercial Banks lending rates, are
relatively higher than the micro-credit rates, it is therefore more economical to get a micro-loan
from a micro financing institution. These conclusions were realized after using the amortization
schedule for calculations.
The population needs to be educated concerning the micro-crediting program, and
shown different business opportunities one can venture into. A follow up person can be
appointed to follow up on whether the loan was put into good use, to avoid extravagancy, the
borrower could be required to submit weekly or monthly reports to the lender instead. More
studies should be done concerning micro-crediting to show how it can be used to improve the
lives of Kenyas. A study on micro crediting where, different loan amounts can be taken up by
the different members of the group is paramount. | en |
