Low income earners’ access to credit from microfinance institutions (MFIs): a case of pride, Shinyanga branch

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University of Dar es Salaam
The study investigated the problem of non accessibility of credit from microfinance institutions (MFIs) to low income earners. Three research questions were raised inherent to the research problem, namely: challenges facing Microfinance institutions in providing credits to low income earners, strategies used by microfinance institution (MFI) to reach the low income earners and MFI credit delivery system and its implication in accessing the low income earners. It is a descriptive research design that employed simple random sampling and systematic sampling to select the 50 respondents used in this study. Judgmental sampling was also used to select PRIDE employees used in the study. Questionnaires filled by respondents were coded and analyzed using a statistical package for social scientists (SPSS). The findings reveal that, microfinance institutions (MFIs) use inefficient approaches to reach the poor which lead to non accessibility of credit to low income earners. They include microfinance institution (MFI) borrowers, advertisements and technical approach to community development. MFI face challenges like lack of transport facilities, untruthful clients who default to pay their loans because of the burden they face, mostly caused by the difficult conditions embedded in the microfinance institution (MFI) delivery system. Moreover, the clients’ residences are within 5 kilometers from microfinance institution (MFI) office. This limits maximum coverage of clients as most of them (living outside 5 kilometers) are not accessed. The study recommends that, the barriers to credit accessibility to low income earners should be addressed to enable low income earners access credit from microfinance institutions.
Available in print form, East Africana Collection, Dr. Wilbert Chagula Library, Class mark (THS EAF HV4161.3.L82)
Poverty, Credit, Microfinance, PRIDE, Shinyanga branch
Lucas, F. (2014) Low income earners’ access to credit from microfinance institutions (MFIs): a case of pride, Shinyanga branch, Master dissertation, University of Dar es Salaam. Dar es Salaam.