A study that details the performance of the Women Enterprise Fund has been released. The study was released at a Research Dissemination Workshop held at Strathmore Business School recently. The study sought to examine the performance of the Women Enterprise Fund (WEF), a Kenya Government Initiative that was aimed to develop and grow women-owned MSMEs. It has been five years since the inception of the Fund and questions are being raised as to whether the Fund is achieving its objectives in reaching the intended beneficiaries with the right kind of funding and support. Fourteen constituencies in four Counties – Kakamega Nairobi, Nakuru, Nyeri and – were sampled for the study. Approximately 900 entrepreneurs were surveyed.
The study was conducted by a team of three researchers; Strathmore’s Dean of School of Graduate Studies, Prof. Ruth Kiraka (lead researcher), Prof. Margaret Kobia (Ag. Director General, Kenya School of Government) and Prof. Allan Mulengani (Dean, Kabarak School of Business).
The study sought to assess the performance of women enterprises supported by the Fund on two key dimensions; Growth and Innovation.
With regard to growth, study findings showed that although the general indicators reflected positive growth among women- owned businesses in terms of total business worth, turnover, gross profit and number of employees however, there were incidences of stagnation or decline for between 15 to 30 percent of the enterprises. The most common form of innovation was in change or addition of new products in the post-loan period.
In regard to innovation and especially new services, new markets, new sources of raw materials or new processes were however less common. The study found no evidence of significant differences in growth and innovation among enterprises across geographical regions, age groups or entrepreneur characteristics such as marital status, level of education, family size and ownership of the other businesses.
The Fund also faced numerous challenges including inadequate WEF field personnel, inadequate field work facilitation, low loan amounts, delays in disbursements and an inefficient multi layered fund structure, high cost of loan administration, competition with commercial bank products, poor dissemination of information, high demand/limited scope of coverage, lack of distinct product branding, lack of individual choices in group lending, bureaucratic processes, limited business monitoring, misconception about purpose of the Fund, low literacy among segments of women borrowers, lack of loan securities and political interference.
To reform the Fund in a way that enhances its quality, service delivery and sustainability, the study recommends: improved field level staffing at WEF, improved business monitoring, allocation of more resources to field teams, provision of individual loans, increase in amounts of loans, enhanced and standardised training, development of legal framework for defaults recoveries, increased funding to the Constituency Women Enterprise Stream (as opposed to financial intermediaries), business incubators for start-ups, enhanced revolving funds, increasing the number of loan holding banks, timely disbursement of the funds and simplifying the application process.