The effects of microfinance loans on low income households in Kashari County
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Date
2013-04
Authors
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Journal ISSN
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Publisher
Kampala International University, College of Economics and Management
Abstract
This study intended to show the effects of Microfinance loans on low income households. It was
one in Kashari County, Mbarara, Uganda. The study aimed at finding out how the microfinance
institutions have performed in extending and providing loans service to the rural population. A
umber of microfinance institutions have sprung to provide the needed service to improve the
usiness of beneficiaries.
fowever, their growth period recovery is short and of high interest rate This unable ineffective use
of the loans by low income households putting the standard of living at stand still This trend of
persistent low standards of living in Kashari County is the basis of this research. the study
the objectives of the study included the following; to establish the nature of loans given by
nicrofinance, to find out the loan policies in microfinance institutions in and to establish the
relationship between microfinance loans and the standard of living of low income households in
Kashari County.
rhe study employed a across-sectional research design (Ranjit 1996: 81) which includes both
survey and ethnographic methods. Using this research design, data will be collected from more
than one respondent in Kashari County at a single point in time. The design enabled the research
to examine the diversity within the rural and urban credit users. It further enabled the research to
triangulate between the quantitative survey questionnaires and the qualitative FGDs and key
informants interviews.
The findings of the study revealed that MFis and MF loans have plans to improve beyond areas of
Bwizibwera, Rubindi and cover more rural areas like Kagongi, Rwanyamahembe, Bubaale subcounties
and others. The researcher also found out that some people got the loan but did nothing
that could bring in development, for instance some used it for gambling.
Recommendations were given and this included; it should establish infonnation and advisory
centers to train low income households in their various business. Apart from recommendations got
as a result of the study, they should also carry seminars or workshops to educate people on the
importance of acquiring loans and how they can use it effectively for personal development.
Description
A research dissertation submitted to the college of Economics and management sciences in partial fulfilment of requirements for the a ward of a Bachelor's Degree in business administration (banking and finance) of Kampala International University
Keywords
Microfinance loans, Low income households