This report discusses the role of informal financial groups in extending access to financial services in Kenya. The scale of informal financial groups in Kenya has long been known to be extensive but reliable data at the national level has not existed.
The report first reviews the literature on informal groups in Kenya (mostly ROSCAs and ASCAs) to highlight the key ways in which their functions and role have been analysed. It argues that the fascination in the literature has been with their ubiquity and apparent success. Secondly, the report uses data from the 2006 Financial Access Survey carried out in Kenya to examine the scale, scope and nature of informal groups. . This survey provides the first significant nationally representative dataset (n=4214). Logistic regression analysis and cross tabulations were used to assess the socio-economic, geographic and demographic characteristics of users.