• Daniel Ambundo Munala KCA University
  • Dr. Julius Korir KCAUniversity, Kenya



Constraints, Growth, Micro finance institutions


Purpose:The purpose of this study was to determine the constraints to growth of micro finance institutions in Nairobi County, Kenya

Methodology:The study adopted a descriptive survey research design to study the factors constraining the growth of the MFls. A census of all the 54 MFIs registered with the Association of Microfinance Institutions of Kenya AMFI was carried out. The informants for the study were drawn from the senior employees.Data was collected using questionnaires. Data obtained was analyzed using descriptive statistics by use of graphs and pie charts.

Results: The study findings revealed that Only 36 per cent MFIs offer micro savings as a service, the reason being that the rest (64%) are not registered as Deposit Taking Microfinance institutions by the Central bank of Kenya.

Policy recommendation: The study recommends that loan repayment should be constantly monitored and whenever there is a default in repayment, a quick action should be taken. The Microfinance should also avoid granting loans to the risky customers or for speculative ventures, monitor loan repayments, and renegotiate loans whenever borrowers get into difficulties. Credit analysis of potential borrowers should be carried out in order to judge the credit risk with the borrower and to reach a lending decision

Author Biographies

Daniel Ambundo Munala, KCA University

Post graduate student

Dr. Julius Korir, KCAUniversity, Kenya



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How to Cite

Munala, D. A., & Korir, D. J. (2017). CONSTRAINTS TO GROWTH OF MICRO FINANCE INSTITUTIONS IN NAIROBI COUNTY, KENYA. International Journal of Finance, 2(1), 108–124.