Micro Enterprise Development

Microfinance is a general term to describe financial services to low-income individuals or to those who do not have access to typical banking services. Microfinance is also the idea that low-income individuals are capable of lifting themselves out of poverty if given access to financial services. While some studies indicate that microfinance can play a role in the battle against poverty, it is also recognized that it is not always the appropriate method, and that it should never be seen as the only tool for ending poverty.

 A microfinance institution (MFI) is an organization that provides microfinance services. MFIs range from small non-profit organizations to large commercial banks.

i. LABALU

LABALU is a credit scheme, a micro enterprise program, in the Catholic Diocese of Homa Bay aimed at uplifting the living standards of the community members within the Diocese through provision of micro credit to its members with identified business plans.

Due to low income among many members in the diocese many households live below one dollar a day i.e. well below the poverty line. In some cases there is no income at all for people with special needs in the society. There is great need to look into how these groups of people can become productive members with income generating activities for their livelihood.

LABALU seeks to empower the community members on micro-entrepreneurship and other income generating initiatives.

The Challenge of High default rate in loan repayment as a result of rising number of dependants in families due to deaths caused by HIV & AIDS

HIV prevalence in the diocese is high and is approximated at 21%. This means the number of HIV & AIDS deaths are many hence many orphans, widows and widowers. Many families are affected since they have to accommodate these orphans left behind. Some of these orphans are also living with HIV and therefore need special attention. The widows or widowers left behind may also be infected making them less productive to the society. All these persons then will become dependants of other relatives giving them more unbudgeted for burden hence increased expenditure. If this family had been advanced some loan then the repayment will either be reduced or defaulted completely.