Launching a Small Business Creation Programme in Kenya

Abstract

KLAAS MOLENAAR IS A CONSULTANT IN SMALL enterprise development with the ETC Foundation in Leusden, The Netherlands. This paper describes the introduction of a small business creation programme in Kenya. As essential part of the process is the portfolio credit guarantee scheme designed by the author, who was in charge of the programme from 1985 until 1987. The basic idea behind the programme, aimed at refugees, was that lack of security was preventing prospective starters from obtaining loans. The author says that the experiments in Kenya proved that it was possible to bring together the interests of financing institutions looking for a profit, development agencies that wish to make credit available to more marginal borrowers and small borrowers seeking easier access to credit and loans and to meet their respective needs. The programme is a very young one and drawing conclusions is a difficult task; furthermore, the target group served under the experimental programme in Kenya (refugees) has special characteristics which make it difficult to assess the validity and possible success rate of the programme for other target groups. Nevertheless, first results were encouraging, particularly as to opening up the banking and financing systems to groups that previously had received very little attention and support.