Social factors affecting women groups’ investment behaviour in Nairobi’s Mathare informal settlements

Abstract

From a world population of slightly above eight billion people as estimated by the United Nations as at November 2022, Informal settlements or slums dominate the urban landscape and were the home to almost One point one two billion people as of the same year. The world population of women in the same year was estimated at 3.95billion. More than 50 per cent of the urban female population this year was estimated to be staying in the informal settlements. Research has shown that the majority population in informal settlements is economically marginalized and experiencing high poverty levels. As such, they depend on informal sources of finance (self-help groups) to meet their financial requirements. The bulk of the studies have focused on savings and lending within women's groups, with minimal consideration of converting these savings into investments, whether individually or as a group. This study aimed to examine the nature of investment exhibited by women in informal settlements and the factors that inform this investment. The research was done in the Mathare informal settlement. It was an explanatory research design study guided by Prospect theory and the Modern Portfolio, using questionnaires and Focus group discussions as means of data collection. Data from the questionnaire was analyzed using a regression model to determine the extent to which each independent variable influenced the dependent variable. In the correlation analysis, all the research variables, such as Education, Spousal Support) and Age, all influenced the investment behaviour of women in informal settlements in Nairobi, Kenya, positively. The results of the regression analyses also indicated that the social factors investigated accounted for the variation among the women in the informal settlements of Mathare in Nairobi. The chi-square test statistics, show that all social factors significantly positively impacted investment behaviour. This research therefore finds that social factors can influence women's behaviour in the informal settlements of Mathare in Nairobi regarding investment. The research further concluded that these factors must be aligned with the particular investment behaviours to enhance investment behaviour. Non-governmental Organisations (NGOs) are encouraged to participate in training and the acquisition of skills needed to handle finances. The research suggests that the government of Kenya's existing funds should be increased to support the improvement of these skills. The research also suggests that women investors should be advised to invest more in their awareness and knowledge of investment trends and opportunities through means such as attending business seminars and engaging investment advisors.

Key words: Social factors, Investment behavior, Education level, age, marital status, saving, women groups