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Title: Credit policy and loan portfolio performance in micro finance institutions: a case study of Opportunity Bank Kamwokya Branch, Kampala
Authors: Ongelech, Joshua
Keywords: Credit Policy
Loan Portfolio Performance
Micro Finance Institutions
Opportunity Bank
Issue Date: Aug-2018
Publisher: Kampala International University, College of Economics & management.
Abstract: The study investigated and sought to establish the relationship between credit policy and loan portfolio performance: A case study of opportunity bank in Kamwokya on’ Kira Road just 3 kilometers from the city center Kampala. The research objectives included; to evaluate the effects of credit policy in Microfinance Institutions (MFI5), to determine the level of loan portfolio performance and to establish the impact of credit policy on loan portfolio performance in opportunity bank. The study employed across sectional research design where both quantitative and qualitative approaches of data collection were employed to collect data from 50 respondents. The participants were selected using two sampling techniques; purposive and simple random sampling. The data was collected using questionnaires and interview guides which was then analyzed descriptively. Most of the MFI5 lack the efficient ris management mechanism that will help eradicate or sieve out serial defaulters. To effectively lock out these serial defaulters, MFIs requires referencing solution that will enable them submit and share data whilst processing their customers’ credit application. The study revealed that all the institutions that participated in the study have a loan risk management policy that is in operation. The stakeholders who are involved in credit policy formulation to a great extent are the members of these organizations and the regulator while the employees and the directors are involved in the credit formulation process only to a moderate extent. The study confirmed that the existing credit policy of the organization forms the basis for developing a new credit policy that is used by the organization. The institution has set up well funded risk management functions, with enhanced risk awareness among lenders, risk strategies are followed in disbursement of credit, the institution conducts thorough risk assessment on the potentials clients and it has also set up fund to cater for the risks that the institution may incur in its transaction
Description: A research report submitted to the Department of Economics and Applied Statistics in partial fulfillment for the requirement the Award of a Degree of Bachelor of Arts in Economics of Kampala International University
Appears in Collections:Bachelors Degree in Economics

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