Assessment of the role of commercial banks in promoting Micro-finance services in Tanzania

The main objective of this study was to make assessment of the role of commercial banks in promoting micro finance activities in Tanzania. Commercial banks are argued to have significant contribution on the growth of MFIs in terms of increased number and amount of loans, the quality of services MFIs extend to their clients and asset accumulation of MFIs. Commercial banks loans and other services were therefore expected to have positive impact on the growth of MFIs. The sample size was 92 respondents, 32 from four commercial banks and 60 from four MFIs from Dar es Salaam. Both qualitative and quantitative methods were used in data analysis. Simple linear regression analysis was also employed. SPSS and Microsoft Excel were employed. Analysis of the data and- testing of hypotheses led to a number of conclusions. First, it was concluded that there is a significant statistical relationship between commercial banks loans to MFIs and the amount of loans that MFIs issued to their clients. Secondly, it was concluded that the amount of loans offered by commercial banks have no significant statistical effect to the growth of MFIs. Lastly, it was concluded that commercial banks' non-financial services like training had no significant statistical association with the performance of MFIs in terms of the quality and capacity of services that MFIs provide to their clients.