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The Relationship between Saving and Micro Credit Program and Small Businesses in Eritrea : Evidence from Central Zone

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Title: The Relationship between Saving and Micro Credit Program and Small Businesses in Eritrea : Evidence from Central Zone
Other Titles: エリトリアにおけるマイクロファイナンス機関と中小企業の関係に関する実証分析
Authors: Negash, Fiyori Afeworki Browse this author
Keywords: Eritrea
Small and Micro Enterprises (SMEs)
Micro Financial Institutions (MFI)
Savings and Micro Credit Program (SMCP)
Positive Attitude
Issue Date: 25-Mar-2021
Abstract: It is universally accepted that Micro Finance Institutions (MFIs) have a significant contribution in supporting Small and Medium Enterprises (SMEs) and buttressing the economy of developing countries.This study hasattempted to investigate the challenges that SMEs face in their efforts towards growth in Asmara, Eritrea.This study also attempted to measurethe SME’sawareness and attitudes towards microfinance.Moreover, the research set out to identify the risksand challenges facing the SMCP, the sole MFI operating in Eritrea.145 SMEs, were selected and stratified asbeneficiaries and non-beneficiaries of MFI. We collecteddata through questionnairesfrom 145 small business owners. To assess the risks posed to theSMCP, data was collected from 67 small business owners benefiting from MFI loans. For a fuller picture, data was also collected from the management of the MFI through interview.The findings have consolidated the conventionally accepted merits of MFIwhile at the same time making certain interesting new findings in the case of Eritrea.Although, there are some research findings that question the contributionof MFIs in alleviating poverty,MFI has overwhelmingly increased the capital of the limited SMEsbenefiting from loans. However, the number offemale beneficiaries is less than desired. A diversion of loans for other purposes has also been discovered. We additionally found that there is considerable lack of awareness about and positive attitude from thebeneficiaries towards MFI. The study foundthat beneficiaries cite shortage of capital isthe main challenge to MFI in the country. Findings also indicate that lack of diversified products offered by the SMCP is a weakness. These problems have causeddissatisfaction among the beneficiaries. Interestingly, the study found that the management ofthe MFI hasdivergent opinions on the challenges that their institution faces.The study concludes that there is a need to increase the amount of credit made available on top ofa reduction of interest rates.These findings underline the need to ramp up sensitizationefforts and to increase access to loans for SMEs by privatizing and proliferating MFIs in Eritrea.Finally, the study recommends that intervention at thegovernment level in revamping the role of MFIs is critical for any progress in the future.
Conffering University: 北海道大学
Degree Report Number: 甲第14477号
Degree Level: 博士
Degree Discipline: 経営学
Examination Committee Members: (主査) 教授 石井 利昌, 准教授 後藤 允, 准教授 鈴木 広人(城西国際大学), 准教授 樋渡 雅人
Degree Affiliation: 経済学院(現代経済経営専攻)
Type: theses (doctoral)
Appears in Collections:課程博士 (Doctorate by way of Advanced Course) > 経済学院(Graduate School of Economics and Business)
学位論文 (Theses) > 博士 (経営学)

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