The microfinance institutions and economic welfare of the underprivileged groups in Rwanda A case study: Urwego opportunity bank limited

Abstract

The general objective of this study was to examine the impact of MFIs on the economic welfare of underprivileged groups in Rwanda. Specifically, the study sought to analyze the extent to which services offered by UOB improve the economic welfare of underprivileged groups in Rwanda, examine extent to which underprivileged groups access to financial services offered by UOB and to find out the challenges faced by both parties customers during the accessibility of financial services by UOB in delivering these services. The study used descriptive survey design. The target population was 46000 clients or beneficiaries of UOB MFIs financial services and the sample size was 250 clients chosen using simple random sampling technique. The researcher used Quantitative method of analyzing the data. The study revealed that UOB as microfinance institution has provided MFIs services to different groups of underprivileged “productive or active poor and the institution uses various strategies to deliver its services. The study recommends that MFIs should put in place measures in order to; reduce the costs of loans given to the underprivileged groups and improve the business skills of these groups through training and loan management, conduct surveys regarding market rates as to sell their products at a reasonable price that customers can afford, improve access to financial services, customers deposit their repayments to the nearest UOB’s partner banks and increase on the amount of loans to the beginners’/new customers to let them expand their businesses easily other than spending a year or more still on the same amount.