Essays on microfinance in east-Africa

Abstract

Microfinance has found itself at the center of development agenda for many a developing economy struggling to reduce poverty and spur economic growth by containing unemployment. This is based on the assumption that if marginalized people can access cheap loans, they could easily create micro enterprises and lift themselves out of poverty. This thesis investigates the effect of microfinance as a mode of financial inclusion in the East-African economy. Using 2 essays, we pose various research questions to achieve our overall objective 1) what are the themes arising from two decades of research in each of the three countries and what are the gaps in literature from the region? 2) How do existing modes of financial inclusion in East-Africa affect microfinance? Is microfinance necessary in light of on-going over indebtedness crisis? 3) How has microfinance helped marginalized individuals such poor women create sustainable enterprises? The study is modeled on human and social capital theories and will employ the use regressions to test the hypotheses and make recommendations.