Unlocking financial inclusion: explaining the varying levels of success of internationally funded microfinance projects within Kenya

This thesis investigates the factors explaining the varying levels of success of international funded microfinance projects in Kenya, focusing on the role of the theory of asymmetric information. This research highlights Kenya as a critical case due to its significant financial exclusion, and many Kenyans lacking access to basic financial services. Through process tracing, the thesis examines the impact of microfinance projects funded by the World Bank and the European Union. The analysis reveals that the World Bank’s emphasis on sustainability and innovations leads to higher success levels compared to the European Union’s focus on long-term loans and gender equality. Additionally, the World Bank’s ability to navigate and mitigate problems caused by asymmetric information contributes significantly to the success of its projects. This thesis contributes to the broader theoretical debate on international development finance, providing insights into optimizing the operations of global...Show moreThis thesis investigates the factors explaining the varying levels of success of international funded microfinance projects in Kenya, focusing on the role of the theory of asymmetric information. This research highlights Kenya as a critical case due to its significant financial exclusion, and many Kenyans lacking access to basic financial services. Through process tracing, the thesis examines the impact of microfinance projects funded by the World Bank and the European Union. The analysis reveals that the World Bank’s emphasis on sustainability and innovations leads to higher success levels compared to the European Union’s focus on long-term loans and gender equality. Additionally, the World Bank’s ability to navigate and mitigate problems caused by asymmetric information contributes significantly to the success of its projects. This thesis contributes to the broader theoretical debate on international development finance, providing insights into optimizing the operations of global financial institutions. The implications of this thesis are relevant for both developed and developing countries, as they provide for financial inclusion and poverty reduction, ultimately benefiting the global economy.Show less

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Unlocking financial inclusion: explaining the varying levels of success of internationally funded microfinance projects within Kenya