Challenges facing the growth of microfinance institutions in Tanzania : the case of pride Tanzania

The aim of this study was to assess the challenges facing the growth of Microfinance Institutions (MFIs) in Tanzania. The findings are the report based on research questions which are aligned with specific objectives of the study which focused on services provided by MFIs, factors hindering the growth of MFIs, usefulness of MFIs growth in Tanzania and management strategies on MFIs growth in Tanzania. The study was conducted at Pride Tanzania Limited located in Dar es Salaam. The study adopted on a Sample size of 60 respondents was selected from the entire population. Questionnaires, interviews, observations and documentaries were used as means of data collections. The findings of the study revealed that financial services are provided by MFIs and they support the SMEs and MSE in Tanzania. Also the findings of the study revealed that high interest rates, capital inadequacy, lack of credit risk management and increase of non-performing loans are the key factors hindering the MFIs growth in Tanzania. From the finding of the study, it may be concluded that strategic management is a key factor for MFIs growth or failure. It is recommended that, service quality and service provided by MFIs must be enhanced. MFIs must reduce interest rates in order to attract more borrowers. Sustainable deposits mobilization strategies are vital in order reduced cost of fund and interest expenses. Credit risk management should be given priority in MFIs industry. Management strategies are the key for the success or failure of MFIs in Tanzania.