Despite Kenya having over 40 banks, only three banks are accessible to the residents of Kibera Slum. Kibera Slum is located on the outskirts of Nairobi and is home to approximately 0.75 million people. A majority of the population in Kibera Slum comprises of either unemployed or casually employed adults whose income levels are considerably low, making it impossible for many of them to operate formal bank accounts. However, the evolution of mobile money technologies has made financial inclusion and innovation possible for Kibera Slum residents. The mobile-banking facility known as M-Pesa enables mobile money remittances and has an outstanding record of financial inclusion and innovation. The objective of this research was therefore to examine financial inclusion and innovation in the Kibera Slum. The study used self-administered questionnaires to answer to two objectives. The study found out that M-Pesa services are accessible and widely used in Kibera Slum. The study also found that M-Pesa business is rated average as a source of income to M-Pesa agent. Ultimately, the study observed that financial inclusion and financial innovation are prevalent in Kibera Slum. These findings have significant implications: the study sheds light on the fact that the slum dwellers have embraced the use of M-Pesa services as a platform to access financial services, establishing more innovative financial services that will help the low income earners expand their businesses and training M-Pesa agents will enhance sustainable business growth and promote innovation.
TopPoverty And Demographics In Kenya
According to the data released by Kenya National Bureau of Statistics and United Nations, (2018), the current population in Kenya is slightly above 50 million on an area of 580,370 km2. Out of this population, about 70% are below the age of 30 years. The mean average age of the population is 19 years while life expectancy is 59.5 years. The ratio of male to female is almost 1:1. Out of the total population, about 36 million are in the rural areas and 14 million in the urban areas. As a result of harsh climatic conditions and land fragmentation, the urban areas are becoming over populated with young school leavers searching for formal employment. According to the United Nations Development Programme (2018), unemployment stood at 39.1% which is the highest in East Africa. In 2018, youth unemployment stood at 55% and this is ages between 15 years and 24 years (Ng'ethe, 2018). According to a joint report by World Bank and Peace Child International (2018), one of the major causes of youth unemployment is lack of access to capital.
According to a report released by United Nations Development Programme (2018), indicated that Kenya is still struggling with high poverty at 29.2% of the total population (16 million). A large portion of the population lives on less than $1.25 per day, and thus unable to meet most basic human needs (United Nations Development Programme, 2018). Further indication shows that the government of Kenya will not achieve the sustainable development goal number 1 (eradication of poverty) by the year 2030. Despite the fact that the country has shown progress in advanced economic activities meant to bring down the poverty levels, studies show that rural areas suffer from high poverty and uneducated population (World Bank, 2018).
A report by International Monetary Fund (2014) shows that wealth in Kenya is held by a few while majority live in either absolute or extreme poverty. Furthermore, men have higher income than women despite increased participation by women in social-economic development in the society (Society for International Development and Kenya bureau of Statistics, 2013). There is a big gap in earnings with a few Kenyan earning hefty income while the majority earning below $ 500 per month. Wealth is unequally distributed in Kenya which has led to majority of the population being financially excluded from the formal financial institutions (KNBS, 2018).