Financing Micro, small and medium Enterprises in Kenya (Micro-Finance option)

MALLANS DRRAMBOCHARLES. "Financing Micro, small and medium Enterprises in Kenya (Micro-Finance option).". In: PHD THESIS. European Psychiatric Journal; 2004.


Distance Learning programme enhances equitable access to higher education in Kenya. The Bachelor of Education (Arts) by distance learning was initiated at the University of Nairobi nearly two decades ago to enable teachers upgrade their skills for improved service delivery. Learners in this programme are expected to finance their education from own resources. However, the rising cost of living delays completion of the programme by up to 30%, as resources are diverted to cater for immediate family needs. Data from the School of Continuing and Distance Education (SCDE) and University of Nairobi Enterprises and Services Limited (UNES) for 2006 show that out of a total enrollment of 6,740 learners, only 4,467 (66%) were actively pursuing the course; implying that about 2,273 (33%) were inactive mainly because of financial constraints. The situation is attributed to limited financing programmes at the national level. Although HELB was established to further higher education, limited financial support from the exchequer makes it difficult to provide assistance to learners outside regular academic programmes.

The study was guided by the following objectives: assess the impact of socio-economic, academic and professional background of learners on ability to finance B.Ed (Arts) by distance learning; establish various modes of financing adopted by learners; explore the challenges faced under the programme and coping mechanisms; evaluate the effectiveness of various funding strategies in terms of accessibility, affordability and adequacy, as well as determine the cost-efficiency of the B.Ed (Arts) by distance learning. In addressing the objectives, both quantitative and qualitative methods were used. These included a survey, in-depth interviews and desk review to source requisite primary and secondary data. The survey covered 673 learners; drawn using stratified simple random sampling procedures; while in-depth interviews were held with eight officials from financial institutions. Also interviewed were nine officials from the SCDE. Key informants were those directly involved in higher education financing initiatives and management of distance learning activities

Quantitative data were processed and analysed to produce frequency distributions, cross tabulations with Chi Square statistic to test hypotheses and binary logistic regression to determine the net impact of each predictor variable. In addition, qualitative data were organized in line with the objectives. This was followed by description to produce interim reports; areas that required additional information were identified and gaps filled. The final step involved systematic analysis and interpretation of interim reports, which were then integrated with quantitative output. The study found that affordability of the B.Ed (Arts) by distance learning was statistically associated with learners' gender, total number of dependants, average income and highest education level. Further analysis showed that learners financed distance learning through loans from commercial banks; personal savings; donations; support from family members and bursaries. Others included proceeds from disposal of assets; dividends from stocks as well as fundraisers. Loans from SACCO societies and commercial banks were the formal sources of funding.

Impediments to effective participation in the DL included meagre incomes, inadequate time to engage in Income-generating Activities (IGAs), high cost of residential fees; and inadequacy of learning materials. In addressing the issues, learners adopted a number of coping mechanisms such as disposing off properties, suspending personal development projects, venturing into IGAs such as operating nursery schools, grocery shops, cyber cafes, welding workshops and farming among others. On its part, the University allowed learners to take up the optimal number of units they could afford, creating provision for special papers; linked up with other institutions such as African Virtual University (AVU) to source for cost-effective learning materials. The University also engaged in IGAs including facilitation of seminars and training. Further findings showed that B.Ed (Arts) by distance learning was relatively more cost efficient than the regular mode. This arose from effective cost management practices and distance learning methodologies adopted.

Based on the findings, the study recommended that the HELB Act be amended to cover distance learning learners; that annual budgetary allocations to HELB for loans and bursaries should be increased; and that a database on gender, total number of dependants, level of income and education level should be developed and used to decide on the degree of financial support to learners. Other recommendations emphasized on formulating a national policy on financing distance learning learners; strengthening Constituency Development Fund (CDF) programmes; improving networking with stakeholders; creating special funding grants at the university and establishing a revolving fund. In further research, the study recommended the need for study on the role of employers in financing distance learning; the impact of e-learning on affordability of distance learning; factors encouraging drop out and deferment of studies and the cost-benefit analysis of the distance learning.




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