The relationship between microfinance credit policies and loan repayment a case study of Pride Micro Lugogo Branch
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Date
2007-10
Authors
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Publisher
Kampala International University, College of Economics & Management
Abstract
Pride Microfinance Uganda traces its roots to a project which started its operations in
western Uganda in December 1995 funded by the Austrian Regional Bureau in
Development Co-operation. The emergence of Microfinance industry is to extend
financial services to the vast majority of the economically active population.
The main objective of this research was to determine how the credit policies of Pride
microfinance enhance or affect loan repayment. The beneficiaries of loans from
microfinance are considered as the clients or debtors of the lenders (microfinance
institutions). Donors and practitioners have to set and advocate for policies that will
ensure accountability and growth throughout loan repayment.
The researcher used descriptive research design. Primary data was obtained by
interviews using questionnaires and was analyzed in frequencies and percentages.
Data was presented in tables and figures.
Findings indicate that credit policies are relevant because they favored most of the
clients and they assisted the organization in reducing the bad debts. Therefore, there is
a significant relationship between credit policies and loan repayment.
The researcher therefore recommends that Pride microfinance Lugogo Branch should
try to cultivate a culture of voluntary repayment among its customers. There is also
need to diversify services to embrace advisory and knowledge based activities, which
could help improve on future loan repayment.
Description
A thesis submitted to the School Of Postgraduate Studies in partial fulfilment for the award of Master of Business Administration (Accounting and Finance option) of Kampala International University
Keywords
Microfinance credit policies, Loan repayment, Pride Microfinance, Lugogo Branch