Themicroloanfoundation's Blog

Client study findings!
April 14, 2010, 11:19 am
Filed under: Uncategorized

MicroLoan recently completed a study of commercial credit access for our clients. 123 clients, staff and bankers were interviewed over the course of three weeks to figure out what the major barriers to credit were and how MicroLoan impacted a clients’ ability to get commercial credit.

28% of clients said they were not accessing commercial loans because of the requirements of collateral. Fortunately, MicroLoan uses a group-lending method to avoid the need of collateral, making our loans accessible by all. 14% lacked physical access to banks. While commercial banks cannot look for clients in rural areas, MicroLoan equips loan officers with motorbikes to reach the most remote rural areas (up to 80km from the town center and often inaccessible by car).

We managed to find that completing our loan process had a positive impact on household incomes. Clients starting our loan process typically had a daily income averaging 164 MWK (0.86 USD/0.66GBP). Once they reached the end of their standard loan process and reached the bridging loan level, daily incomes rose to about 1,150 MWK ( 6.00 USD/ 4.60 GBP).

Moreover, the study confirmed positive economic impacts of empowering women. Businesses that were run independently by our clients with no involvement from the husband tended to show more revenues being invested in household welfare, particularly in paying for children’s school fees.


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