Responses of Micro Finance Institutions in Kenya to the Turbulent Business Environment

Purpose: Environmental changes have serious economic effects and are of great concern for organizations that would wish to be ahead of competition. Environmental forces affect the types of products developed, the nature of positioning and market segmentation strategies, the types of services offered, and the choice of business to acquire or sell. The study sought to gain a better understanding of the responses of MFIs to the challenges emanating from the turbulent business environment that affect MFIs, both positively and negatively and the factors that influence these responses, which are critical to their outreach and sustainability.Methods: The focus of the study was the MFIs that are registered members of the Association of Micro Finance Institutions (AMFI). By June 2013, AMFI had a total membership of 17 Micro Finance Institutions and the researcher undertook census survey of all the 17 MFIs. Responses to various issues of concern were collected through structured questionnaires, which were administered to the MFIs in Nairobi and its environs by hand delivery and picked up on completion. Further, the researcher conducted a comprehensive literature review of materials relevant to the study, whose sources included various websites, books, journals and local daily newspapers and reports obtained from the various MFIs. Out of the 17 questionnaires sent out, 16 were returned completed, a 94 per cent response rate. The information gathered was analyzed using the Statistical Package for Social Science (SPSS), presente