Factors Influencing Performance of Self-help Group Members’ Microenterprises in Kiambu County, Kenya

Abstract

Self-Help Groups (SHGs) have proved to be an important tool in poverty reduction in many countries in the world but still there are very many poor people who have continued to ignore them. Governments, non-governmental organizations and other development agencies have continued to encourage and finance these SHGs but still many people still ignore them. The study sought to determine the factors that influence the performances of members of SHGs’ micro-enterprises. The main objective was to establish factors which influence performance of the members’ microenterprises, and their effect on their well-being. Literature was reviewed on SHGs and performance of their members’ micro-enterprises/Income Generating Activities (IGAs). The literature also covered factors that influenced performance of the micro-enterprises which were: characteristics of self-help group members, their participation in self-help groups and support that they had received from their groups. The effect of performance of the microenterprises on the well-being of the members was also covered. The study was guided by the self-help groups and the Grameen Micro-enterprise models. The research was carried out in Ndarugo Division of Gatundu District in Kiambu County, Kenya. Ten (10) SHGs and sixty six (66) members were selected using systematic sampling while ten (10) key informants were selected using purposive sampling. Data were gathered from the members using questionnaires and from the key informants using interview guides. More than 62% of the respondents had been members of their SHGs for less than 5 years, had little savings and their reasons for coming together included support of one another. The SHGs had between fifteen and twenty members. About 88% of the members had families and were active in the groups. Nearly 55% of their projects were agriculture based while non-agriculture activities included shops, motorbike taxis, catering, hiring out tents and chairs. With these IGAs, the members were able to feed their families and pay their bills, especially medical and school fees. The study had the following findings. All active SHGs had been linked to organizations like Food and Agriculture Organization (FAO), and other local organizations. Their members’ networking had improved a great deal and they had learnt a lot from each other. The challenges of the SHGs included lack of capital, lack of marketing for their produce and lack of training and the fact that 84.8% of the members were of only secondary and primary school levels of education plus only 25.8% were males. More than 90% of the members were satisfied with the performance and leadership of the SHGs. The study concludes that nearly 90% of members felt that the performance of their SHGs and microenterprises (MEs) had helped them to improve their lives - this was noticed through improvement in food self-sufficiency, housing, paying school fees, medical expenses and improved networking. Member characteristics and SHG support contributed to performance of members’ MEs. Member participation was also important to the performance of the MEs and motivated members. SHGs were capable of contributing to the national economy and so the government should introduce soft loans and rewards to the groups and enhance their training opportunities. The study therefore recommends that the government should avail grants and loans to all viable SHG projects and should also enhance training for all SHG members.