Table Banking: Revolutionizing Access to Capital in Informal Communities

• Communications Team
• May 12, 2023
• JJF News, Press Release
• 0 Comments

Small businesses and individuals in informal communities face significant challenges in accessing capital within the world of finance. However, the game is changing thanks to table banking, a micro-financing model based on group savings and lending with agreed-upon interest rates. This model is simple, flexible, and accessible, making it a popular choice for informal sector workers in Kenya who heavily rely on informal financial services.

The African Development Bank found that table banking groups in Kenya have grown to over 300,000 with an estimated total savings of over Ksh. 3 billion. This highlights the critical role of table banking in providing affordable and accessible financial services to those who need it most.

Table banking has also proven to be a solution to the gender gap in access to formal financial services, which limits women’s ability to save, invest, and participate in economic activities. In Kenya, table banking has empowered rural women to start businesses, improve their homes, pay for their children’s education, and save for emergencies. As of 2023, 48% of women in Kenya are involved in some form of table banking, saving an average of Ksh 200 ($2) per week, which translates to a total of Ksh 14,206 ($104) per year.

Leah Vilt member of Women Empowered group standing next to her food vending trolley, donation of trolley made by JJF.

Besides providing access to credit, table banking strengthens social cohesion within communities, as participants learn to trust each other and build strong relationships that extend beyond financial transactions. This is particularly important for women who often face social isolation.

In conclusion, table banking is a crucial tool for promoting financial inclusion and empowering women in informal communities. Its benefits extend beyond access to credit, as it strengthens social ties and fosters a sense of community. Therefore, it is essential to support and promote table banking to ensure that more women can benefit from this valuable resource.

Sources:

• https://documents1.worldbank.org/curated/en/545241624880584363/pdf/Financial-Inclusion-Women-and-Building-Back-Better.pdf
• https://www.ilo.org/wcmsp5/groups/public/—ed_emp/—emp_ent/documents/publication/wcms_820312.pdf
• https://www.ilo.org/wcmsp5/groups/public/—ed_emp/—emp_ent/documents/publication/wcms_820312.pdf