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Promoting Inclusive Markets and Financial Systems

Quality of Delivery Study

Quality of Delivery Study


The Quality of Delivery Study (QDS) assessed the outreach, value added and consumer protection of project-formed and locally-formed Savings Groups (SGs) in Western Kenya. Donors have invested in Savings Group formation assuming that these investments lead to more outreach, better products, and more security, compared to spontaneous Savings Groups, traditional ASCAs or ROSCAs. The QDS sought to test this assumption.

The research involved 1,370 households in three sites where SG projects were known to have operated, and a control site. The study found that outreach had increased substantially in sites where SG projects had been operating, reducing overall levels of financial exclusion in those areas. SG members are generally drawn from the ‘middle poor’, but are better educated, more entrepreneurial and better connected than average, suggesting that the projects may need to focus more on depth (as well as breadth) of outreach. In project sites, SG’s were of higher quality than in the control site, where groups had formed spontaneously. However, quality (and cost of delivery) varied substantially across different delivery models. SGs are strongly appreciated by members, and in all areas SGs have increased their membership, testimony to their value for local communities.

The study found that SGs generally provide a safe and transparent place to save, but 5.2% of members reported that they had lost money in groups, and this is a concern. The study also found that around 15% of members drop out of groups, mostly because of ‘inability to save’ suggesting that poverty may be a barrier. Overall, the QDS makes a valuable contribution to benchmarking and assessing the development value of investments in financial sector deepening through informal infrastructures.

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