Harmonizing the factors constraining accessibility of credit to women entreprenuers in Tanzania: a case of Morogoro district

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Sokoine University of Agriculture.


The study on harmonizing the factors constraining accessibility of credit to women entrepreneurs was conducted in two divisions namely: Mikese in Morogoro rural and Morogoro urban districts. The objective of the study was to establish different scenarios that harmonize factors limiting accessibility of credit to women. The study involved 103 respondents who were credit beneficiaries from three types of financial institutions; the Formal Financial Institution (FFI), Semi-formal Financial Institution (SFFI) and Informal Financial Institution (IFI). Data were collected using structured questionnaire and by reviewing various secondary data from several sources. Descriptive and quantitative statistics such as frequencies, mean, cross tabulations, Chi-square and cluster analysis were used in analyzing the data. Findings showed that more than half (52%) of women entrepreneurs used their own savings as start up capital. Results indicated that, FFI and SFFI were located in urban areas except IFI which were found in both urban and rural areas. This implies that operation of FIs are limited in rural areas. It was noted that FINCA and Informal lender used group security and guarantor (s) respectively while NMB demand assets and business license as collateral. Findings confirmed that more than half (56.8%) of the respondents faced problems of high interest rate, insufficient amount (21%) short grace period (11.2%) and walking long distance (9.3%) while few (1.7%) of respondents had faced problem of misunderstanding within group. Cluster analysis results to harmonize the type, location and financial institution’s objectives suggested different possible recommendations that can improve accessibility of credit to women entrepreneurs. Women residing in urban areas with formal education, having high monetary value assets, operating registered small and medium enterprises FFIs are main and suitable sources of credit. SFFIs and IFIs will be the major source of credit to women residing in rural and urban areas with formal or no formal education, own low monetary value assets, operating registered or unregistered small-scale enterprises which require small loan. Women entrepreneurs wishing to secure loan from SFFI should form groups prior the application of loan as the major criterion for the institution. Loan from FFI should be applied by women who require individual loan and have already started up their business in a permanent premises. FIs aiming at assisting women in income creation should develop mechanisms of financing new IGAs in urban and rural communities thus many women will benefit from disbursed credits and ultimately engaged more in IGAs. Finally because most of rural women were engaged more in farming as their main occupation FIs should provide loan for farming activities inorder to improve agricultural production.



Morogoro district, Credit accesibility, Women entreprenuers, Financial institutions