A macro analysis of SACCOS loan performance: a case of Singida municipal council

The main objective of this •study was to investigate macro-economic factors that influence loan performance in SACCOS as one of the Micro Financial Institution (MFI) in the context of liberalized economy. In order to test whether there has been a relationship between loan performance and selected macro-economic variables in the context of the opportunistic model, data were collected using questionnaire, interview and documentary review from entire population of 28 SACCOS that exist in Singida municipal, and data were analyzed using linear regression analysis with help of SPSS. The study found out that there is negative relationship between GDP, inflation, and monetary aggregate with loan performance of the SACCOS. While, there is a positive relationship between loan performance with interest rate and the number of SACCOS. The recommendations given out with regard to the findings are: The SACCOS' management should consider GNP, servers' savings, interest rate and monetary aggregate when making the loan decisions. Municipals should enact by laws that enforce members of the SACCOS in case of transfer and resignation from the jobs to ensure reduction of non-performing loans to the SACCOS. The SACCOS have to institute follow-up mechanisms including having SACCOS' lawyer, who will deal with cases of the SACCOS.