Funded by IPA’s Consumer Protection Research Initiative and in partnership with IPA Kenya, researchers are conducting a randomized evaluation in Kenya to measure whether a personalized loan recommendation tool and a know-your-rights training module can improve women entrepreneurs’ trust in financial service providers, promote well-calibrated credit decisions, and reduce the incidence of post-contract harassment.

The Challenge

Although women’s financial inclusion has increased around the world in recent years, women still face significant social barriers in accessing and leveraging their accounts to improve their economic livelihood.¹ In Kenya, many creditworthy women entrepreneurs avoid formal bank loans due to fears that financial institutions encourage over-indebtedness and engage in post-contract harassment, including unregulated home visits and unlawful seizure of household property. These practices disproportionately affect women, who face heightened reputational and domestic consequences. Interventions such as informational nudges and digital complaints systems have aimed to improve consumer protection and provider behavior, as well as to improve redress. However, there is limited evidence on approaches that directly address borrowers’ fears, leaving an open research question: Can borrower-facing digital tools that provide loan guidance and rights information reduce fear-driven credit avoidance?

The Evaluation

In partnership with IPA Kenya, researchers are conducting a randomized evaluation to measure whether targeted digital interventions can reduce women entrepreneurs’ avoidance of formal credit and rebuild their trust in financial service providers.

The intervention involves 750 women micro, small, and medium enterprise owners in Nairobi, who are randomly assigned to the following groups:

• Personalized loan recommendation tool: This tool provides data-driven borrowing guidance based on entrepreneurs’ cashflow, business profile, and risk tolerance, using a machine-learning model trained on data from over 2,500 past loan applicants.
• Digital know-your-rights module: This module informs borrowers of legal protections against harassment, seizure limits on unsecured loans, and formal complaint mechanisms.
• Comparison group: Entrepreneurs will receive existing marketing materials from the partner financial institution.

Both interventions will be delivered via mobile platforms to maximize accessibility and scalability. To assess actual behavior rather than intentions, participants will state whether they wish to apply for a loan and receive real-time application support to submit to the partner financial institution.

Results

Results will be available in 2027.

Sources

^1. Anna Tabitha Bonfert and Alexandra Norris, “More women have financial accounts, yet equal access and use remain works in progress,” World Bank Blogs, November 11, 2025, https://blogs.worldbank.org/en/opendata/more-women-have-financial-accounts--yet-equal-access-and-use-rem