The Financial Sector Deepening Kenya (FSD Kenya) is an independent Trust dedicated to the achievement of an inclusive financial system that supports Kenya’s long-term development goals. We work closely with Government, the financial services industry and other partners to develop financial solutions that better address the real world challenges faced by low-income households, enterprises and underserved groups such as women and youth.
Our objective is to facilitate increased incomes, reduced vulnerability to shocks, and better capacities invest in the future. We pursue this objective through partnerships across the public and private sectors, including with the Government, the financial services industry, and other development partners across key economic and social sectors.
These partnerships vary significantly depending on the need at hand. They may involve FSD Kenya offering technical assistance, commissioning relevant research, financing substantial programmes of activity, providing policy advise, or simply collaborating where we find shared interests in our quest for an inclusive financial market that helps Kenyan achieve better livelihoods, as well as increased value from finance as an enabler of prosperity.
FSD Kenya was established in 2001 to support the development of inclusive finance as a means to stimulate wealth creation and reduce poverty. In 2005, FSD Kenya was constituted as an independent Trust. We operate under the supervision of professional trustees, KPMG Kenya, with policy guidance from a programme investment committee (PIC). Our core development partners are the UK’s Foreign, Commonwealth & Development Office (FCDO), the Swedish International Development Agency (Sida), and the Bill & Melinda Gates Foundation.
To support the development of inclusive financial markets in Kenya as a means to stimulate wealth creation and reduce poverty.
The Government of Kenya has established a long-term vision to “create a globally competitive and prosperous nation with a high quality of life by 2030.” Vision 2030 emphasises that all Kenyans should enjoy a high quality of life. Improving economic opportunities and delivering vital services to low-income Kenyans is an integral plank towards achieving the country’s long-term aspiration for prosperity.
We recognise that low income lower-income earners already participate in the economy, for instance as wage workers, smallholder farmers, small-scale traders, or consumers. However, they are often constrained by inadequate access to quality, affordable and usable financial services. We continuously seek to unlock their potential by understanding the constraining issues and partnering with relevant market players to find solutions that best address the needs of such individuals, households, and small-scale enterprises.
Towards this end, we seek financial solutions that address real world financial problems. We aim to unlock barriers in areas such as agriculture, health, education, and trade, as well as emerging priorities like affordable housing and climate change. The link between financial market development and poverty reduction is the main rationale for the FSD Kenya programme.
We work with a wide range of partners in Kenya, from policymakers and regulators such as the National Treasury and the Central Bank of Kenya through key industry associations such as the Kenya Bankers’ Association to innovators in the financial sector. We try to stimulate change in a variety of ways – though policy advice, technical assistance, applied research, co-funding, risk-sharing, and very occasionally early stage investment. Whatever approach we take is determined by the outcome required to address a particular market development problem or opportunity.
In summary, we partner with financial sector stakeholders in the endeavour to develop an inclusive financial sector that supports Kenya’s long-term development ambitions.
FSD Kenya’s range of interventions include supporting innovation, conducting research, and supporting policy and regulatory processes that shape the development of the inclusive financial ecosystem that we envision. Our work can be categorised into the following four strategic pillars:
A shared vision, across stakeholder groups, of how the financial system should develop to support national development objectives and specifically the reduction of poverty.
A supportive policy and regulatory environment in which the formal rules that govern the financial system shift incentives in favour of low-income households and smaller-scale enterprises.
An efficient and open finance industry infrastructure supporting increased competition, expanded services, and lower costs.
Market capacity and incentive to innovate financial solutions for real world problems of low-income households and the economies of the poor.
FSD Kenya operates with policy guidance from our programme investment committee (PIC) and Trustees, KPMG Kenya.