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CHAPTER FOUR DATA ANALYSIS AND PRESENTATION OF FINDINGS 4.

0 Introduction This chapter analyzes data collected by the researcher. Data was collected, edited, organized, analyzed and finally presented both quantitatively and qualitatively using descriptive statistical tools and tables, graphs and charts, and the information obtained was interpreted according to research questions. Questionnaire was the research instrument used in the study of the effects of Islamic microfinance on Muslims in the lowest socio-economic segment in Kenya. During the survey, a total of 70 questionnaires were issued to the respondents. Any non response to specific questions was marked as missing data on SPSS Version 10.0 software, used in this study. A total of 51 questionnaires were returned with responses out of the 70 that the researcher issued to respondents. The data that was gathered by the researcher was analyzed using frequencies and percentages, and presented in form of tables, bar and pie charts. The analyses were guided by the research objectives that were discussed in chapter 1. 4.1 Demographic profile information 4.1.1 Gender profile Figure 4.1 below shows the percentage of male and female respondents in this study, i.e. 35% male and 65% female respondents. Thus, majority of the respondents were female. Fig. 4.1.1: Gender profile

This implies that the majority of those using the Islamic microfinance at the site of the study, in the lowest economic segment and as surveyed in this study, were women. This implication is restricted to a kind of economic segment referred to in this study, and may not necessarily apply to other economic segments. 4.1.2 Age of the respondents Further, the majority of the respondents surveyed happened to be in the age bracket of above 35 years of age. This is captured in fig. 4.1.2 below. Fig. 4.1.2(a): Respondent's Age Age 20-25 Years old 25-35 Years old Above 35 Years old Total Frequency 3 13 35 51 Percent 5.9 25.5 68.6 100.0 Valid Cumulative Percent Percent 5.9 5.9 25.5 68.6 100.0 31.4 100.0

Fig. 4.1.2ba): Respondent's Age

The above fig. 4.1.2 illustrates that 5.9% of those surveyed fell in the age bracket 20-25 years of age while 25.5% were in the age bracket 25-35 years of age. However, a 68.6% majority of the

respondents were in the age bracket of above 35 years of age. Thus, the majority of those using Islamic microfinance products at the site of the study, are aged 35 years and above. 4.2 Access to Financial Services 4.2.1 Knowledge of the Islamic Microfinance products In fig. 4.2.1 below, the descriptive results of the respondents knowledge of the Islamic Microfinance products are presented. Fig. 4.2.1(a): Knowledge of the Islamic Microfinance products Is the respondent aware of the products?
Frequency Valid No Yes Total 9 42 51 Percent Valid Percent 17.6 82.4 100.0 17.6 82.4 100.0 Cumulative Percent 17.6 100.0

Fig. 4.2.1(b): Knowledge of the Islamic Microfinance products

The results indicate that a high number of the respondents, up to 82.4%, are aware of the Islamic Microfinance products; only 17.6% are not aware of the products. From the above presentation, it can be concluded that the residents of the site of the study are fairly well conversant of the

Shariah compliant Islamic banking microfinance products. Fig. 4.2.1(c) below gives more insight into the current variable, using a crosstab of the respondents knowledge of the products against their gender, i.e. out of the 82% of the respondents who have knowledge of the products, 36% are men and 64% are women. Fig.4.2.1(c): Product knowledge*Respondents Gender Cross-tabulation
Is the respondent aware of the products? * Respondent's Gender Crosstabulation Count Respondent's Gender Is the respondent aware of the products? Total No Male 3 Female 6

Total 9

Yes

15 18

27 33

42 51

Further, based on their age categories, fig. 4.2.1 (c) below shows that out of the 82% respondents who are aware of the Shariah compliant Islamic banking products, 7% are in the age bracket 2025 years, 24% are in the age bracket 25-35 years and 69% are in the age bracket of 35 years and above. Fig. 4.2.1(d): Product knowledge* Respondent's Age Cross-tabulation
Is the respondent aware of the products? * Respondent's Age Crosstabulation Count Respondent's Age 20-25 Years old 25-35 Years oldAbove 35 Years old Is the No 3 6 respondent aware of the products? Yes 3 10 29 Total 3 13 35

Total

42 51

The preceding exposition leads to the conclusion that the majority of the residents at the site of the study are conversant of the Islamic microfinance products, most of whom are aged above 35 years and the majority of the respondents were women. 4.2.2 Products Used

Given the services of credit, savings and payments, a majority 57.1% of those knowledgeable about Shariah compliant Islamic banking products have used credit services. A further 28.6% have used savings services, while 14.3% have used the payment services. This is demonstrated in fig. 4.2.2 below: Fig. 4.2.2(a): Products Used
Which of the Shariah Compliant MF products have you used? Frequency Percent Valid Credit Services Savings Services Payment Services Missing Total Total -9 24 12 6 42 9 51 47.1 23.5 11.8 82.4 17.6 100.0 Valid Percent 57.1 28.6 14.3 100.0 Cumulative Percent 57.1 85.7 100.0

Fig. 4.2.2(a): Products Used

Fig. 4.2.2(c) below further illustrates a cross-tab of products used against the respondents gender. It is clear that out of the 57.1% of those who have used credit services, 37.5% were men and 62.5% were women; out of the 28.6% of those who have used savings services, 25% were

men and 75% were women; while of the 14.3% who have used payment services, 50% were men and 50% were women. Fig. 4.2.2(c): Products used * Respondent's Gender Cross-tabulation
Which of the Shariah Compliant MF products have you used? * Respondent's Gender Crosstabulation Count Respondent's Gender Total Male Female Which of the Credit Services 9 15 24 Shariah Compliant MF products have you used? Savings Services 3 9 12 Payment Services 3 3 6 Total 15 27 42

Finally, based on their ages, fig. 4.2.2(d) below demonstrates a crosstab of the products used against the respondentsages. It shows that out of the 57.1% respondents who have used credit services, 0% are in the age bracket 20-25 years and 25-35 years and 100% are in the age bracket of 35 years and above; out of the 28.6% of those who have used savings services, 0% are in the age bracket 20-25 years, 58.3% are in the age bracket 25-35 years and 41.7% are in the age bracket of 35 years and above. Finally, of the 14.3% who have used payment services, 50% are in the age bracket 20-25 years, 50% are in the age bracket 25-35 years, while 0% are in the age bracket of above 35 years. Fig. 4.2.2(d): Products used * Respondent's Age Cross-tabulation
Which of the Shariah Compliant MF products have you used? * Respondent's Age Cross-tabulation Count Respondent's Age Total 20-25 Years old 25-35 Years old Above 35 Years old Which of the Credit Services 24 24 Shariah Compliant MF products have you used? Savings 7 5 12 Services Payment 3 3 6 Services Total 3 10 29 42

Given the above account, it is clear that of the three services under investigation, credit services are used most, followed by savings services and lastly payment services. Further, two of the three services, namely credit and savings, are mainly used by women as compared to men. However, both men and women equally use the payment services. Finally, respondents aged 35 years and above have primarily used credit services, while those in the age bracket 20-25 years have not used either credit nor savings services, only payment services, which interestingly, those aged above 35 years have not used. 4.2.3 Distance to the Bank Fig. 4.2.3 below, illustrates the frequencies of responses regarding respondents views on distance between their specific residences and the nearest Shariah compliant bank branches. Fig. 4.2.3(a): Distance to the Bank
What is the average distance from your residence to the bank? Frequency Percent Valid Percent Valid 0 - 10 km 10 - 20 km 20 - 30 km 30 - 40 km Total -9 15 18 6 3 42 9 51 29.4 35.3 11.8 5.9 82.4 17.6 100.0 35.7 42.9 14.3 7.1 100.0 Cumulative Percent 35.7 78.6 92.9 100.0

Missing Total

Fig. 4.2.3(b): Distance to the Bank

It is definite that most of the Shariah compliant bank branches are within at most 20kms from the respondents residences. Specifically, 33% of the respondents have the nearest Shariah compliant bank branches just within 10kms from their residences. A further 42% have the branches within 20kms reach. Only 5% have the nearest branch being at least 30kms away. 4.2.4 ATM and Bank Penetration Table 4.2.4 below captures the frequencies of responses regarding ATM and bank penetration. Table 4.2.4: ATM and Bank Penetration ATM and Branch penetration Deposit services are offered in the branches. Credit services are offered in the branches. ATMs are available in all the regions. Branches are available in all the regions. Payment of services is offered in the branches Strongly Disagree 0 2 22 23 9 Somewhat Disagree 1 1 5 7 3 Neither Agree Nor Disagree 2 5 2 5 6 Somewhat Agree 10 9 6 7 9 Strongly Agree 29 25 7 0 15 Total

42 42 42 42 42

In percentages form, figure 4.2.4 below demonstrates the respondents views on ATM and bank penetration. Figure 4.2.4: ATM and Bank Penetration

The highest percentages show that most respondents strongly agreed that deposit services are offered at the branches, i.e. 69 % of the respondents. On credit services offering, again majority 58% of the respondents strongly agreed that the services are available. However, only 15% agreed that ATMs are available countrywide; a 51% majority strongly disagreed. This was the case with branch network availability; only 15% agreed that there is country-wide branch network availability, the majority of 52% strongly disagreed. Finally, a 33% majority of the respondents strongly agreed that payment of services is offered at the branch levels, with 20% responding on the exact contrary. Generally, there appears to be availability of required services, but ATM and branch network availability is unsatisfactory.

4.2.5 Level of satisfaction on the costs of the Microfinance products Respondents generally seem to be comfort with the cost implications involved in transactions of the Shariah compliant financial products, as captured in table 4.2.5 below:

Table 4.2.5(a): Level of satisfaction on the costs of the Microfinance products Cost of financial products Very Satisfied The minimum Account Balances Payment Fees Bank Account Charges Costs on Loan facilities 18 12 21 27 Somewhat Satisfied 11 9 7 4 Neither satisfied Nor Dissatisfied 3 4 3 2 Somewhat Very Dissatisfied Dissatisfied 6 4 5 5 4 14 6 4

From fig. 4.2.5 below, on percentages of the intrinsic ranking of the cost implications involved in transactions of the Shariah compliant financial products, it is noted that up to 40% of the respondents are very satisfied with the minimum account balances required by their banks. However, a majority of 30% are very dissatisfied with the payment fees, while a majority of 47% is equally very satisfied with bank account charges. A further overwhelming 62% majority are very satisfied with the costs on loan facilities from their banks. Fig. 4.2.5(b): Level of satisfaction on the costs of the Microfinance products

From the above facts, we can conclude that the respondents are to a large extent comfortable with the minimum account balances, bank account charges and costs on loan facilities, but would wish the payment fees to be reviewed downwards. 4.3 Investment Portfolio 4.3.1 Income generating Activities It is sometimes argued that education and health provision, legal and political changes, and global economics all affect the abilities of people to secure an income. Income-generating activities can be considered as those initiatives that affect the economic aspects of people's lives through the use of economic tools such as credit. The income generating activities listed were: Starting a Business
Retail Shop Expansion

Grocery Shop Expansion Tailoring Shop Expansion Fig. 4 revealed that, reveals that the wide range of activities undertaken by the respondents. Fig. 4.3.1 below shows in percentage form, the preferred income generating activities engaged in by respondents using the Shariah compliant microfinance.

4.3.2 Ownership of assets through credit facilities Table 4.3.2 below, illustrates the frequencies of responses regarding ownership of assets using finances acquired from the banks, under the Shariah compliant arrangement. Table 4.3.2(a): Ownership of assets through credit facilities Ownership of assets Strongly Somewhat Neither Somewhat Strongly

Disagree Disagree The credit facilities have greatly assisted in acquisition of assets There is a limitation to the type of assets which can be acquired using the credit facilities There is a limitation on the credit available to acquire a particular asset 3 2

Agree Nor Disagree 4

Agree 12

Agree 21

11

19

25

Based on the above frequencies, fig. 4.3.2 below demonstrates the respondents views in percentages. Fig. 4.3.2(b): Ownership of assets through credit facilities

From the above fig. 4.3.2(b), it is clear that on a collective level, respondents strongly agree with the arrangements on ownership of assets through credit facilities availed under the Shariah compliant microfinance. For instance, 50% of the respondents strongly agree that the credit facilities have greatly assisted in acquisition of assets, while another majority 45% holds the same sentiments as far as limitation to the type of asset that can be acquired using the credit facilities. However, 59% strongly agree that there is limitation on the credit available to acquire a

particular asset. We therefore conclude that indeed the credit facilities have greatly assisted in the acquisition of assets, in as much as there is a limitation on the type of assets that can be acquired using the credit facilities. However, asset ownership would be greatly enhanced if the credit available to acquire particular assets would be increased.

4.4 Poverty Alleviation 4.3.1 Household Income Fig. 4.4.1 below illustrates the frequencies of the respondents views on household income using the Shariah compliant microfinance. Fig. 4.4.1(a): Household Income
Has your household income increased since you started using the Islamic MFproducts? Frequency Percent Valid Percent Cumulative Percent Valid No 9 17.6 21.4 21.4 Yes 33 64.7 78.6 100.0 Total 42 82.4 100.0 Missing -9 9 17.6 Total 51 100.0

Fig. 4.4.1(b): Household Income

The above summary statistics indicate that 79% of those who have used the Shariah compliant microfinance agree that the finances have helped increase their household income. Only 21% responded on the contrary. A further examination of the results based on respondents gender indicates that out of the 79% agreed that the finances have helped increase their household income, 36% were men and 64% were women. Again, out of the 21% who disagreed, 33% were men and 66% were women. This is illustrated using frequencies in fig. 4.4.1(c) below: Fig. 4.4.1(c): Household Income*Respondent's Gender Cross-tabulation
Has your household income increased since you started using the Islamic MFproducts? * Respondent's Gender Cross-tabulation Count Respondent's Total Gender Male Female Has your household income No 3 6 9 increased since you started using the Islamic MFproducts? Yes Total 12 15 21 27 33 42

We conclude that indeed the Shariah compliant microfinance has helped increase household income, for family members who have used the products.

4.4.2 Education and Training Levels It is clear from fig. 4.4.2 below that the respondents who have used the Shariah compliant microfinance are equally divided on whether the availability of Islamic microfinance products has led to a change in the education and training levels, on the said products. Thus, there is indifference on this aspect of the Shariah compliant microfinance. Fig. 4.4.2(a): Education and Training Levels
With the availability of Islamic microfinance products has the education and training levels changed

Frequency Valid Missing Total No Yes Total -9 21 21 42 9 51

Percent Valid Percent 41.2 41.2 82.4 17.6 100.0 50.0 50.0 100.0

Cumulative Percent 50.0 100.0

Fig. 4.4.2(b): Education and Training Levels

Table 4.4.2 below helps give more insight on the respondents views, based on their age categories. It shows that out of the 50% of the respondents who disagree that Islamic microfinance products have led to a change in the education and training levels, 0% are in the age bracket 20-25 years, 19% are in the age bracket of 25-35 years and 75% are in the age bracket of 35 years and above. Of the remaining 50% who agree that Islamic microfinance products have led to a change in the education and training levels, 14% are in the age bracket 2025 years, 29% are in the age bracket of 25-35 years and 57% are in the age bracket of 35 years and above. Table 4.4.2: Education and training levels*Respondent's Age Cross-tabulation
With the availability of Islamic microfinance products has the education and training levels changed * Respondent's Age Cross-tabulation Count

Respondent's Age 20-25 Years old With the availability of Islamic microfinance products has the education and training levels changed No

Total 25-35 Years old Above 35 Years old 4 17 21

Yes Total

3 3

6 10

12 29

21 42

Based on these results therefore, we are indifferent as to whether Islamic microfinance products have led to a change in the education and training levels. But it is important to note that those aged above 35 years, and probably parents, largely agree that the education and training levels have changed.

4.4.3 Employment Creation Fig. 4.3.3 below illustrates the frequencies of the respondents views on employment creation using the Shariah compliant microfinance. Fig. 4.4.3(a): Employment Creation
Has Islamic microfinance products led to creation of employment? Frequency Percent Valid Percent Valid No Yes Total -9 12 30 42 9 51 23.5 58.8 82.4 17.6 100.0 28.6 71.4 100.0 Cumulative Percent 28.6 100.0

Missing Total

Fig. 4.4.3(b): Employment Creation

It is noted that a majority 71% of those who have used the Shariah compliant microfinance agree that the finances have helped in the employment creation endeavour. A minority 29% think that the said finances have not really helped in employment creation. Fig. 4.4.3(c) below further indicates that of the 71% who agree that the finances have helped in the employment creation endeavour, 40% were men and 60% were women. On the other hand, of the 29% who disagreed, 25% were men and 75% were women. Fig. 4.4.3(c): Employment Creation
Has Islamic microfinance products led to creation of employment * Respondent's Gender Crosstabulation Count Respondent's Gender Total Has Islamic microfinance products led to creation of employment Total No Male 3 Female 9 12

Yes

12 15

18 27

30 42

Further, based on their age categories, fig. 4.4.3 (d) below shows that out of the 71% who agree that the finances have helped in the employment creation endeavour, 10% are in the age bracket

20-25 years, 30% are in the age bracket 25-35 years and 60% are in the age bracket of 35 years and above. Fig. 4.4.3(d): Employment Creation
Has Islamic microfinance products led to creation of employment * Respondent's Age Crosstabulation Count Respondent's Age Total 20-25 Years old Has Islamic microfinance products led to creation of employment Total No 25-35 Years old 1 Above 35 Years old 11

12

Yes

3 3

9 10

18 29

30 42

We conclude that the Shariah compliant microfinance have helped in the employment creation endeavour.

4.5 Overall Discussion of Results

4.6 Chapter Summary

CHAPTER FIVE CONCLUSION AND RECOMMENDATIONS 5.1 Introduction The purpose of this study was to provide factual information regarding the effets of Islamic banking in the lowest economic segment of the residents of Kibera slums, who profess the Islamic religion. The researcher managed to accomplish the purpose, as well as the objectives of the study, which were to establish accessibility of the financial services, and establish measures that could be used to address communication problems. Data from the site of the study was collected by the use of questionnaires. The data that was gathered by the researcher from the respondents was analyzed using both the SPSS software and MS-Excel, and the results presented using in the form of tables, bar and pie charts for the clarity of interpretation, so that all the information supported by the objectives was clear in them vis-vis reading without graphical representation. The researchers major findings of the study were that

5.2 Conclusion

5.3 Recommendations

5.4 Suggestions for Future Research