Influence of socio-economic factors on Women’s participation in rotating Savings and Credit Associations in Kabondo Kasipul Sub County, Homabay County

Abstract

While formal financial institutions (FFIs) are instrumental in the growth of an economy, they require good financial and loan repayment records, attract higher interest rates, and have longer turnaround time, among other unconducive terms. This makes it necessary for local communities to form informal financial institutions (IFIs), like RoSCAs, which allow them access loan facilities faster, easier, at lower interest rates compared to those of FFIs, and allow them form strong social relationships that they can depend upon. It is against this backdrop that this study aimed at determining the influence of socio-economic factors on WPRoSCAs within Kabondo Kasipul Sub-County, Homa Bay, Kenya. Based on the interpretivism research philosophy and the experimental research design, researcher recruited a total 133 participants from the four wards within Kabondo Kasipul Sub-County. Out of the 133, 13, who were RoSCA group leaders, were interviewed, whereas 120 answered questionnaires. Whereas purposive sampling was used to select the 13 RoSCAs from the 43 registered RoSCAs, simple random sampling was used to select the individual respondents who participated in the interview sessions. To ensure validity of the data collection instruments, they were first assessed by Egerton University’s Faculty of Gender, Women, and Development Studies experts for cross checking, content validity, and approval. Piloting of the study was also conducted to increase the study’s findings’ validity. Cronbach’s alpha was then used to test reliability and a correlation coefficient of 0.843 was obtained, thus, was considered acceptable. The quantitative data that was gathered was then analysed using SPSS v.20 software, while qualitative data was analysed thematically using NVivo Software. From the quantitative data, this study found out that gender, marital status, age, house size, level of income, and education level are among the main factors influencing participation in RoSCAs within the study area. From the qualitative data, lack of cooperation, lack of training, misuse of funds by members, inadequate finance, poor relationship, lack of trust, poor attitude, and inadequate group running costs were found to significantly influence WPRoSCAs. To encourage women’s participation in the RoSCAs, this present study established the need for awareness campaigns, frequent RoSCAs group meetings, provision of trainings, disciplinary measures, and provision of finance. Despite realizing its objectives, this paper recommends a broadening of the study sample and the use of a wider geographical area to enhance the generalizability of the findings of such a study.