An evaluation of effectiveness of NGOs in goal attainment in Tanzania: a case study of NGOs for micro-finance.

One of the significant developments in the 1960-70s was the growth and development of the financial sector (the banking system) that was geared at facilitating the broad policies of the government. Nationalized public banks were extended in network to reach the objective population and carry out resource intermediation for development. With the contemporary policies of liberalization of the economy and privatisation (Banking Act, 1991) the banks have tended to shun away from financing the small scale businesses, where high levels of poverty obtains. Coincidentally, we have witnessed the development of the NGOs into the area of micro-financing for poverty alleviation. The NGOs for micro finance are mostly a private initiative and still in infant stages in Tanzania. It is argued that private goals in those NGOs in Tanzania is an impediment to optimal resource-flow to the objective micro-enterprises, due to resource-diversion within the NGOs themselves. The objective of this study was to evaluate the NGOs for micro-finance in Tanzania in view of their objectivity, organisational (intra) efficiency which is key to growth and sustainability and their capacity to reach their targeted populations in terms of service delivery. Fundamentally, this research study has revealed that an NGO for microfinance is a contemporary alternative route in reaching the poor population strata in their investment initiatives, as the formal financial institutions, such as banks, are now off this portfolio. Weaknesses have been noted in those NGOs and basically due to "a few serving the immensity of poverty", and the fact that there has been no definite policy support on organizational set-up established by the government. Recommendations have been raised on how to address those shortcomings and pursue an outward-oriented activity in financial intermediation in the micro-economic sector in Tanzania.