EFFECT OF FINANCIAL CAPITAL FUNDED BY MICROFINANCE INSTITUTIONS ON ECONOMIC EMPOWERMENT OF WOMEN IN GARISSA SUB-COUNTY, KENYA

Abstract

The study was carried out in Garissa sub-county in the North-Eastern part of Kenya. Economic empowerment of women has in the recent years become popular as a strategy to minimize poverty and vulnerability and maximize women’s opportunities to participate in economic development. Through microfinance institutions, women can easily access affordable financial services. This study evaluated the effect of financial capital funded by microfinance institutions on economic empowerment of women in Garissa Sub-County. Analytical research design was used in the study. The estimated target population was 2,238 female members of micro finance institutions in Garissa town. A sample size of 96 respondents was selected by stratified random sampling technique. Semi-structured questionnaires were used in the collection of primary data. Data collected was coded, edited and analyzed using Statistical Package for Social Sciences (SPSS) Version 24 software. Both descriptive and inferential statistics were conducted. Specifically, model fitness R² and correlation coefficients were generated. Data was presented using tables and graphs. At a confidence level of 95%, the regression results produced a correlation coefficient, R = 0.739 which indicated a strong positive association between financial capital and economic empowerment of women in Garissa sub-county. Coefficient of determination, R², was found to be 0.540 revealing that 54% of the variation in economic empowerment of women in Garissa Sub-County was explained by financial capital. The study concluded that financial capital thus highly affected economic empowerment of women in Garissa Sub-County. The study therefore recommends that the government should supplement Microfinance Institutions in provision of services such as credit facilities for example by channeling more women funds through microfinance institutions to reach more women. The findings of this study will be used by stakeholders in the micro-finance sector including policy makers, financiers such as donors as well as regulatory bodies. The study will also be useful to scholars and will contribute to the vast body of knowledge on the role of micro finance institutions on economic empowerment of women

Key Words: Microfinance institutions, Financial capital, Economic empowerment of women