This are institutions that address themselves to the financial needs of particular sectors of the economy which commercial banks have not been able to cater for adequately.the examples include;
- Development finance institutions – primary goal is to promote and aid growth and development of commerce and industry in an economy.eg K.I.E-Kenya Industrial Estates,D.F.C.K.I.D.B-Industrial Development Bank.S.E.F.C-Small Enterprise Finance Company.
- Housing finance companies/building societies – mainly involved in financing housing activities and may either put up houses which they sell to individuals and organisations or provide mortgage finance to qualified people who wish to put up their own houses. e.g. H.F.C.K-Housing Finance Company of Kenya.E.A.B.S-East African Building Society.
- Savings and credit co-ooperatives societies (saccos) – they are formed mainly to enable members save and also obtain loans most conveniently and at favourable conditions.usually formed by people who are engaged in similar activities or are under one employer. e.g. Mwalimu Savings and Credit Cooperative Society, Afya Savings and credit society, Harambee Savings and credit cooperative society.
- Insurance companies and pension funds – they provide finance to commercial organisations as well as to individuals and also assist in creating confidence and a sense of security to their clients. e.g. Kenya National Assurance, N.S.S.F.
- Long term finance companies e.g. I.C.D.C. I.D.G., A.F.C. Finance house and hire purchase firms e.g. D.F.C.K-development finance company of Kenya.