The Impact of Microfinance Institutions on the Alleviation of Poverty and Women’s Empowerment Case Study: Micro Uganda Limited (Nateete Branch).
Author: KAWOTHAR KAKIIKA
Supervisor: Geoffrey Mubiinzi
This study assessed the impact of microfinance institutions on the alleviation of poverty and womenís empowerment. The specific objectives of the study were: To find out how credit services offered by microfinance institutions have helped in alleviating poverty and emancipating women; to investigate the relationship between interest rates charged on the loans offered by microfinance institutions and poverty alleviation and womenís emancipation and to examine the extent to which savings facilities offered by microfinance institutions have aided in alleviating poverty and womenís emancipation.
The study adopted the case study design with quantitative and qualitative research techniques. A total sample size of 43 respondents from Micro Uganda Limited (Nateete Branch) was used. Self-administered questionnaires and face to face interviews were used to collect data. Data was coded and later processed and analyzed. From the study it was revealed that, low income savers tended to maintain steady financial behavior through savings, customers could easily repay the taken loan as they didnít have to pay higher interest rate for taking up the loans and they were also able to have easy access to their financial assets. It was discovered that real interest rate led to an increase in level of savings and hence reducing poverty levels, good interest rate produced the optimal result of maximizing investment. From the study it was exposed that credit enabled poor people to overcome their liquidity constraints, facilitated the poor people to undertake some investments, especially in improved technologies for their business ventures and it also helped poor people to smooth out their consumption patterns during the lean periods of the year.
Finally, it was recommended that Microfinance institution should provide a wide range of financial services so that the poor can choose a service according to their capability. It was also recommended that the government should organize sensitization programs and education programs to introduce the importance of savings and their contribution to poverty alleviation.