Kenya—Microfinance Capacity Building Project (KEMCAP)

Client: U.S. Agency for International Development

Duration: 2004-2008

Region: Sub-Saharan Africa

Country: Kenya

Solutions: Economic Growth

As the trade and financial hub for East Africa, Kenya has been a leader in developing a network of microfinance institutions that extend loans to small farms, businesses, and entrepreneurs. The Association of Microfinance Institutions (AMFI) was formed to serve the interests of these institutions by creating an enabling environment for microfinance, sharing best practices, and creating business connections between various regional firms. KEMCAP’s principal objective was to build and strengthen AMFI so that it could become a permanent fixture in the Kenyan financial services marketplace, improving much-needed industry infrastructure for microfinance institutions while helping to increase client outreach and business performance.

Sample Activities

  • Strengthen AMFI’s managerial practices and technical capacities.
  • Provide leadership and technical guidance to improve the enabling environment.
  • Upgrade industry infrastructure required to facilitate business growth and development.
  • Increase access to diverse sources of funding necessary to meet growing demand.
  • Facilitate ongoing institutional commercialization and transformation.

Select Results

  • Provided best practice guidance to the Central Bank of Kenya, a key project partner.
  • Directly supported commercial banks through technical assistance, consulting, and advisory services.
  • Brokered several loan guarantees through the U.S. Agency for International Development’s Development Credit Authority, and provided technical assistance to increase the use of loan guarantees for small and medium enterprise lending, lending to woman-owned businesses, and warehouse receipt lending.
  • Supported the passage of the Microfinance Act 2006, which allowed for microfinance institutions to become licensed and regulated deposit-taking institutions. DAI staff also took special care to ensure that rural and woman-owned enterprises benefit from KEMCAP’s work.
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