Accessing credit for Micro, Small, and Medium Enterprises (MSMEs) in Kenya is a challenging task due to limited collateral, lack of credit history, and strict lending criteria. This is especially true for small businesses in rural areas.
To overcome this issue, small business owners in rural Kenya often form Self Help Groups to fund their businesses through table banking. Table banking allows members to contribute money to a shared pool and take soft loans. However, the majority of Kenyans lack financial literacy, which limits economic growth even with table banking. According to the Global Financial Literacy Survey, only 38% of Kenyans were financially literate as of 2021(3313-Finlit_Report_FINAL-5.11.16.pdf (gflec.org)
To address this issue, EPTF provides training, mentoring, and business development services to nurture and empower entrepreneurs. The Sustainable Agricultural Practices (SAPs) Project, funded by the Center for Church-Based Development (CKU) and implemented from 2017 to 2020, trained Self Help Groups on the benefits of table banking, financial literacy, savings, and lending. One such group, the Waleet Self-Help Group, transformed their approach to table banking and empowered its members to grow in financial literacy and economic independence.
As a result, they grew their savings and were able to access credit from banks. Through training on group formation, financial literacy, and inclusion provided by the EPTF team in Moiben, Uasin Gishu county, the group was able to secure credit of up to KES 600,000 for its members from a leading bank in the country. This partnership with the bank has democratized credit access, providing each member with access to formal financial tools.
The success of the Waleet SHG is an inspiration to communities everywhere. Through collaboration and determination, they overcame economic barriers and unlocked a future full of possibilities. Their journey from grassroots initiatives to mainstream financial inclusion exemplifies the transformative impact of empowering communities with the tools and knowledge to shape their destinies.