...WP/04/01 Bank of Uganda Working Paper Recognising the Role of Micro Finance Institutions in Uganda Justine Nannyonjo and James Nsubuga _________________________________ Bank of Uganda 2 WP/04/01 BOU Working PAPER Research Department Recognising the Role of Micro Finance Institutions in Uganda By Justine Nannyonjo and James Nsubuga February 2004 Abstract This paper shows that micro finance is an important part of the growth strategy in Uganda and has in the recent years gained increasing recognition. This is evidenced by initiatives and strong commitment by government, donors and practitioners towards supporting micro finance activities in Uganda, and the rapid expansion of the micro finance industry. Integration of Micro Finance Institutions (MFIs) into the formal financial system has been established, while measures have been taken to build capacity and enhance coordination in the micro finance industry, as well as expand the outreach of sustainable micro finance. The paper, however, identifies a number of challenges to the development of the micro finance industry: There is need to strengthen the capacity of MFIs to build their management information systems, and to rebuild infrastructure in underserved areas as well as strengthen capacity for identifying potential market structures, which could serve as the basis on which to build sustainable micro finance services. Other challenges include restoring peace in conflict areas and strengthening...
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...PROJECT ON MICRO FINANCE MANAGEMENT AND ITS ANALYSIS IN INDIA BANKING MANAGEMENT CONTENTS PAGE NO. 1. ABSTRACT 3 2. OBJECTIVE 3 3. METHODOLOGY 3 4. INTRODUCTION 4 5. EMERGENCE OF MICRO FINANCE 5 6. CLIENTS OF MICRO FINANCE 6 7. MICRO FINANCE NEED IN INDIA 6 8. MICRO FINANCING REGULATIONS IN INDIA 7 9. ACTIVITIES IN MICRO FINANCE 8 10. LEGAL REGULATIONS 9 11. GOVERNMENT ‘S ROLE IN SUPPORTING MICRO FINANCE 12 12. MICRO FINANCE SUPPORTING WOMEN 13 13. MICRO FINANCE MODELS 14 14. SUCCESS OF MICRO FINANCE IN INDIA ...
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...poor and poverty have not been yielding the desired result and considerable portion of aids and subsidies meant for the poor are channelized to affluent sections. Institutional mechanism involved in financing the poor through different developmental schemes unsuccessful in doing much to improve the situation and in fact many new problems arise in course of doing so. Poor recovery and siphoning of funds meant for poor have affected not only the viability of developmental schemes but also the profitability of the institutions. The shortcomings and failures of financial institutions and poverty alleviation and development programmes to meet the needs of needy small and poor borrowers kindle the micro finance concept. The impact of micro finance programmes on reduction of poverty is considerably encouraging in many countries. Many studies have revealed that micro finance has made positive impact on some socio economic variables like empowerment of women and Schedule Caste and Scheduled Tribes, child education, household nutrition. The microfinance movement has known an important growth during the last couple...
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...Impact of Microfinance on the Economy of Nigeria 6 Negative Impact of MFIs on the country (Nigeria) 10 Conclusion Introduction Since the advent of microfinance institution in Bangladesh in the mid 1970’s, several countries have copied this financing model. The Nigerian governments over the years have had to grapple with poverty and unemployment. The realization that many of these poor and/or unemployed persons are not without skills, ideas and willingness to work, must have propelled the government to make finance accessible to them. The seeming popularity of this model among developing countries is predicated on poverty reduction prospect it offers. The Nigerian government cued into this popular thinking in 2005 when it inaugurated the microfinance institution scheme. This was founded to provide finance to economically active poor excluded from financing by conventional banks, provide employment, engender rural development and reduce poverty. The introduction of microfinance institutions in Nigeria is the inability of Nigerian Deposit Money Banks to provide sufficient financial service to the rural poor. Microfinance institutions have taken up the challenges of the gap created by the Nigerian Deposit Money Banks. Microfinance institutions can be seen as an economic growth method intended to advantage the low income part of a given country like Nigeria, both rural poor and urban poor. This paper theoretically examines the impact of this institutions...
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...INTRODUCTION 1. Overview The chapter will constitute Background of the study, statement of the problem, objectives of the study, research questions, significance of the study, scope of the study, limitations of the study and conceptual frame-work of the study. 2. Background to the study The micro finance business embraced today arose in Bangladesh in 1976 with the founding of the Grameen Bank. It became popular in the 1980s s a response to doubts and research findings about a state delivery of subsidized credit to the poor farmers. According to Ledgerwood (2001), prior the 1980s government agencies were the predominant avenue for providing productive credit to those with no previous access to credit facilities. Their services had and still have limited access, because they need collateral as a requirement for getting a loan and the transaction costs are so high. Governments and international donors assumed that the poor required cheap credit and saw this as a way of promoting agricultural production by small landholders. Since the 1980s the fields of Micro finance (MF) has grown substantially. Donors actively support and encourage micro finance activities focusing on micro finance institutions (MFIs) that are committed to achieving substantial outreach and financial sustainability. In Uganda, the health of the financial sector has been impaired by political and social turmoil. It was indicated that the troubles of the 1970s and early 1980s produced a severe contraction...
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...have copied this financing model. The Nigerian governments over the years have had to grapple with poverty and unemployment. The realization that many of these poor and/or unemployed persons are not without skills, ideas and willingness to work, must have propelled the government to make finance accessible to them The seeming popularity of this model among developing countries is predicated on poverty reduction prospect it offers. The Nigerian government cued into this popular thinking in 2005 when it inaugurated the microfinance banking scheme. This was founded to provide finance to economically active poor excluded from financing by conventional banks, provide employment, engender rural development and reduce poverty. This paper theoretically examines the impact of this institutions to Nigeria as a country. International Journal of Finance and Accounting Concept of Microfinance Microfinance pertain to the lending of small amount of capital to poor entrepreneurs in order to create a mechanism to alleviate poverty by providing the poor and destitute with resources that are available to the wealthy, alert at a small scale. Micro-finance is a term used to refer to different methods for giving poor people access to financial services. Irobi (2008) defined microfinance as the provision...
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...significance of the study, methodology, limitation and organization of the study. BACKGROUND OF THE STUDY Micro finance is defined as financial service for poor and low income clients. In practice the term is often used more narrowly to refer to loans and other services from providers that identify themselves as micro finance institutions. The introduction of micro finance is a welcome relief to development of various women organization and agencies in Ghana. One of the social problems that affect socioeconomic development of women in Ghana is how to acquire capital to finance their businesses. In Ghana, women have been discriminated against with regards to access to credit. As a result, women’s economic roles are isolated and unimportant which have subsequent economic and social impact on the country. It is important that women’s economic should be realized. Increasing women’s access to micro finance institutions have initiated a series of economic development and have increased the well-being of women and their families. An area of interest that led to this study is the introduction of micro finance initiative by the government of Ghana during the Kuffour Administration and the arrival of several non-governmental organizations (NGOs) and subsequent change in lifestyle of women in Ghana. Over the years the government of Ghana has been introducing micro finance schemes to assist in reducing poverty levels of women in Ghana. Such schemes include Poverty Reduction Fund which...
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...INSTITUTIONS AND ECONOMIC GROWTH OF SMALL & MICRO-ENTERPRISES (SMES) ACASE STUDY OF (UWMFO) MICRO FINANCE INSTITUTION BY HENRY EGYEYU DEDICATION To the memory of my grand father Daniel Egeyu Whose love & enthusiasm for academia first kindled mine? ABSTRACT This research study investigates the impact of microfinance institutions on entrepreneurial development of Small & Micro-enterprises (SMEs) that are craving for growth and development in a war revived district called Gulu. The researcher used questionnaire as an instrument of primary data collection. Tables and simple percentages were used in data presentation. For clear analysis, the study centers on two broad variables; the dependent variable which is entrepreneurial development and the independent variable which is microfinance institutions. Three different hypotheses were formulated and tested using various statistical tools such as chi-square test, analysis of variance and simple regression analysis. The study reveals that (i) there is a significant difference in the number of entrepreneurs who used microfinance institutions and those who do not use them; (ii) there is a significant effect of microfinance institutions activities in predicting entrepreneurial productivity; and (iii) that there is no significant effect of microfinance institutions activities in predicting entrepreneurial development. The researcher concludes that microfinance...
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...International Journal of Scientific Engineering and Research (IJSER) www.ijser.in ISSN (Online): 2347-3878 Volume 2 Issue 4, April 2014 Effects of Micro-Financing on Growth of Small and Micro Enterprises in Mombasa County Veronica W. Ngugi1, Dr F. Kerongo2 1 Jomo Kenyatta University of Agriculture and Technology (JKUAT), Kenya, Department of Economics and Commerce, School of Human Resource Development 2 Jomo Kenyatta University of Agriculture and Technology (JKUAT), Kenya, Department of Economics and Commerce, School of Human Resource Development loans to finance their business operations. The fundamental objective of this study was to assess the effects of Micro financing on growth of small and micro enterprises in Mombasa County. Despite access to credit SMEs growth remains a major problem. Access to credit should enable a business to achieve their growth objective. Despite this it is interesting to note that most of the SMEs could not survive third year of incubation period. Descriptive Survey method was employed in this study. The study adopted stratified and systematic random sampling method. The sample size was 157 SMEs. Semi-structured questionnaire was designed to facilitate the acquisition of data. Data was collected from 102 respondents, a response rate of sixty five percent. Sales, income and competitiveness were used as the independent variable while growth of SMEs as dependant variable. Descriptive statistics was used to analyze data. Results indicated...
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...CHAPTER 1 1.0 INTRODUCTION The concept of micro finance is not new in the world, sub-Sahara Africa and in Kenya. Savings and credit groups have operated for centuries all over the world. They include the Chit Funds of India, Tandas in Mexico, and Arisan in Indonesia. In Africa such groups consist the “Susu” of Ghana, BOSCA of Botswana, ADESSI of Burkina Faso, ACCORD of Uganda, Zusa of Zambia among others. In Kenya on the other hand Micro Finance Institutions (MFIs) include Faulu Kenya, Kenya Women Finance Trust (KWFT), KUSCCO (Kenya Union of Savings and Credit Cooperatives), Economical Locus Fund (ECLOF), Small and Medium Enterprise Programme (SMEP), Kenya Small Traders and Entrepreneurs Society (KSTES), the Kenya Post Savings Bank (KPSOB) and Vintage Management (Jitegemee Trust). Microfinance is the provision of financial services to low income households and micro and Small Enterprises (MSEs). The sector provides an enormous support to the economic activities of the poor thus contributing to poverty alleviation. Micro finance is usually understood to entail the provision of financial services to micro entrepreneurs and small businesses, which lack access to banking and related services due to the high transaction costs associated with serving these clients’ categories. The two main mechanisms for the delivery of financial services to such clients are relationship based banking for individual entrepreneurs and small businesses; and group based models, where...
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...0 INTRODUCTION In the past, government has initiated series of micro programmes targeted at the poor with the overriding objective of making credit readily available to those who were traditionally denied access to credit. Such credits in the world over were used for the development of small and meduim scale enterprise, which has been described as the springboard for sustainable development. In all emerging economies like Nigeria, the government has shown a great concern for the development of small and meduim scale enterprise because of the underlying socio economic factors plaguing the nation. some of the reasons include: the past policies failed to generate efficient self sustaining impetus needed to uplift the country to the ‘take-off’ stage of growth, the increased emphasis on self-reliant approach to the development and the recognition that dynamic and growing petty-business can contribute substantially to a wide range of developmental objectives. However, the full potential of the micro business in the development process have not been realized owing to numerous bottlenecks. In the light of this, the Central Bank of Nigeria (CBN) as part of its reform agenda, initiated Micro Finance Banks, a policy initiative aimed at bringing credit to the door step of the poor who do not have such access under the conventional financial system. The thrust of this project is to articulate the prospects of the micro finance banks towards boosting the performance thereby reducing the level...
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...KWAME NKRUMAH UNIVERSITY OF SCIENCE AND TECHNOLOGY SCHOOL OF BUSINESS THE USE OF STRATEGIC HUMAN RESOURCE DEVELOPMENT AS A MEANS OF ACHIEVING CORPORATE OBJECTIVE IN THE MICROFINANCE SECTOR. (A CASE STUDY OF SOME SELECTED MICROFINANCE INSTITUTIONS) BY: ACKON BEATRICE APRAKU ESTHER ASABEA OPPONG-SEKUM KINGSLEY A DISSERTATION SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENT FOR THE AWARD OF THE DEGREE OF BACHELOR OF SCIENCE BUSINESS ADMINISTRATION (HUMAN RESOURCE MANAGEMENT OPTION) MAY, 2015 DECLARATION We the undersigned, declare that this is the result of our own research work carried out in the School of Business, and under the supervision of Mr. Emmanuel Oheneba-Acquah ACKON BEATRICE 8535512 …………………………… …………………………… APRAKU ESTHER ASABEA 8548912 …………………………… …………………………… SEKUM-OPPONG KINGSLEY 8584412 …………………………… …………………………… CERTIFIED BY: EMMANUEL OHENEBA-ACQUAH……………………….. ……………………………. (SUPERVISOR) SIGNATURE DATE MR. J.E TURKSON ………………….. ……………………………. (HEAD OF DEPARTMENT) SIGNATURE DATE DEDICATION This study is dedicated to the Almighty God, we made this possible despite the many challenges faced and to our supervisor Mr. Emmanuel Oheneba-Acquah whose patience and intellect, guided us through this whole phase. We appreciate you! ACKNOWLEDGEMENT ...
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...Economics & Political Science Post graduate studies Economic Department Finance for Growth and Role of SMEs An Application to Egyptian Case Prepared by: 1- Amr Hassan Elkady 2- Nashwa Mohamed Hussein Presented to: Prof. Hala El-Saied 2010 In September 2004, the Financial Sector Reform Program was launched and endorsed by the Government of Egypt at the highest political level. The five pillars of the program are reforming the banking sector, restructuring the insurance sector, deepening the capital markets, developing a well functioning mortgage market, and activating other non-bank financial institutions and services. The program aims at improving the soundness of the financial sector and promoting an enabling environment for an efficient, competitive and agile financial system that serves Egypt’s development and growth objectives. The progress and pace of the Egyptian Financial Sector Reform Program have been commended at home and abroad. However, we still have some way to go to fully reform the sector and address its main challenges; one of which is ensuring better access to financial services which is imperative to economic growth and development. Improving access to finance allows businesses, especially small and medium enterprises, to capitalize on their...
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...42 14. Conclusion 44 15. Bibliography 46 OBJECTIVE OF THIS PROJECT WORK This project work tries to outline the prevailing condition of the Microfinance in India in the light of its emergence till now. Microfinance refers to small savings, credit and insurance services extended to socially and economically disadvantaged segments of society. It is emerging as a powerful tool for poverty alleviation in India. The prospect of Micro-Finance is dominated by SHGs (Self Help Groups) - Banks linkage Program. Its main aim is to provide a cost effective mechanism for providing financial services to the poor. To understand the transformation experiences better, the issues that trigger transformation were identified viz.: size, diversity of services, financial sustainability and focus. It is argued that the transformation experiences in India are not large in number. However, I found that there are three forms of organizations that seem to be popular in the microfinance sector – the Non-Banking Finance Companies, the Banks– both Local Area Banks and Urban Co-operative Banks and the Co-operatives. The concept of Microfinance is analysed by undertaking a...
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...An Evaluation of Micro-Finance Programmes in Kenya as Supported through the Dutch Co-Financing Programme With a focus on KWFT Otto Hospes Muli Musinga Milcah Ong’ayo November 2002 Study commissioned by: Steering Committee for the Evaluation of the Netherlands’ Co-financing Programme 3 Contents List of contributors List of abbreviations Acknowledgements 1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 2 Introduction Background and objectives Legitimization and overall objective of Dutch CFAs to support micro-finance programmes Partners of Dutch CFAs operating in the micro-finance market of Kenya Central questions Organization and methodology Process implementation and limitations of the study Structure of the report A brief description of micro-finance in Kenya and agencies as supported by Dutch CFAs Micro-finance in Kenya 2.1.1 The emergence of micro-finance as an industry 2.1.2 Types of micro-finance agencies in Kenya 2.1.3 Service delivery approaches 2.1.3.1 Savings services 2.1.3.2 Loan products 2.1.4 Outreach 2.1.4.1 Banks 2.1.4.2 NGO-MFAs 2.1.4.3 Savings and Credit Co-operatives (SACCOs) 2.1.4.4 ROSCAs and ASCRAs A profile of micro-finance agencies and schemes as supported by Dutch CFAs 2.2.1 General profile 2.2.2 Specific profiles 2.2.2.1 K-REP Development Agency (KDA) 2.2.2.2 Kenya Women Finance Trust (KWFT) 2.2.2.3 Jitegemea Credit Scheme (JCS) 2.2.2.4 PRIDE Africa – Sunlink Some conclusions 7 9 11 13 13 15 16 17 17 18 19 21 21 21 23 25 26 28 28 31 33 35 35 36 36...
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