Background

The Decentralized Financial Systems (DFS) pilot project started in early 2003 as an action research initiative under the MicroSave-Africa programme addressing the problem of rural outreach. This pilot was an initial step towards building the capacity of community based models of financial service delivery, exploring a number of models and starting work on developing approaches – codified in toolkits – which address critical constraints to the effectiveness of these models. Funding for the first year of activity was provided by FSD as a part of the extension agreed to funding for MicroSave-Africa phase II. An extension to the DFS pilot was agreed in May 2005 to allow further progress toward the objective which was “to develop and test simple and effective tools and delivery techniques to strengthen operations, management and governance in community based financial organizations as a building block for developing sustainable and robust decentralized financial systems in Kenya.”

Objective

To develop and test simple and effective tools and delivery techniques to strengthen operations, management and governance in community/rural based financial organisations as a building block for developing sustainable and robust decentralised financial systems in Kenya.