Study Overview
Women- and youth-led SMEs in East Africa face complementary constraints to growth — limited business capabilities, restricted access to finance, and indivisible production infrastructure. Which of these bind, and for which entrepreneurs, remains an open empirical question. We propose a pilot in Kenya with Somo Africa to lay the foundations for a full-scale RCT of Somo's integrated training–financing–hub model, in which financing decisions are driven by the Somo Scorecard, a proprietary AI-based alternative-data credit score that replaces collateral and formal credit history with performance data derived from Somo's DigiKua record-keeping tool. The pilot is designed to (i) validate a two-stage randomization against Somo's programmatic funnel; (ii) quantify take-up, compliance, and attrition by arm and by Somo Scorecard tier — in particular, whether low financing take-up reflects selection of not-yet-finance-ready applicants, an AI scorecard calibrated too tightly, or demand-side risk aversion; (iii) characterize outcome distributions needed for power calculations for the full RCT; (iv) validate instruments including DigiKua-derived business records that serve as the alternative data underlying the Scorecard; (v) identify operational considerations to resolve before scale-up. These learnings will shape the full RCT that can identify which constraints bind and for whom — and whether AI-based alternative-data credit scoring can independently identify the women entrepreneurs for whom credit is most productive.
Intervention Partner: Somo
Populations: Small, micro enterprises, Small businesses