Factors influencing participation in community based micro-finance : a case of village banking in Kaunda square, Lusaka.

Community-based micro-finance initiatives, notably Village Banking, are vital for financial inclusion and economic empowerment in marginalized communities globally. This study delves into the factors impacting participation in Village Banking in Kaunda Square, Lusaka, Zambia. Its main aim is to explore the factors influencing participation in Community-Based Micro Finance, focusing on Village Banking. Objectives include assessing perceived benefits, evaluating institutional facilitators or barriers, and analyzing socio-economic characteristics of participating households. Employing a mixed-method approach, this study adopted an interpretivist research philosophy. Purposive sampling was used, involving government officials, direct practitioners, and current participants. A total of 45 participants were involved in the study, including two government officials, two direct practitioners, and 41 current participants in Village Banking programs. Data were collected through structured questionnaires, in-depth interviews, and focus group discussions. Key informants included government officials (n=2) and direct practitioners (n=2), selected based on their expertise and involvement in microfinance policies and practices. The study revealed that Village Banking participants in Kaunda Square were predominantly female, reflecting broader trends in microfinance. Participants perceived enhanced financial situations through the program, although challenges such as over-indebtedness persisted. Institutional factors such as accessibility and satisfaction with governance structures influenced participation. Socio-economic characteristics, including education and employment status, also played significant roles in decision-making. The findings underscored the importance of tailored outreach efforts, financial literacy programs, and collaboration with local authorities to enhance participation. Recommendations included gender-specific support, diversification of financial products, and targeted capacity-building initiatives to address socio-economic challenges. Community-based micro-finance initiatives like Village Banking held promise for economic
empowerment in Kaunda Square, Lusaka.