Microfinance Products and Socio-Economic Growth of Entrepreneurs in Uganda: A Case of Entrepreneurial Clients of Pride Microfinance

Abstract

This study investigated the contribution of microfinance products towards the socio-economic growth of entrepreneurs in Uganda, using a case study of the entrepreneurial clients of Pride Microfinance Limited, Jinja Branch. The investigation was prompted by the question as to why small scale entrepreneurs continue to be financially vulnerable, with slow rates of growth and limited improvements in the standards of living despite the presence of many Microfinance Institutions (MFIs) in Uganda. The  objectives of the study were: to examine the contribution of loan products towards socio-economic growth of the clients; to establish the contribution of saving products towards socio-economic growth of the entrepreneurial clients and to establish the contribution of Money Transfer products towards the socio-economic growth of the entrepreneurial clients of Pride Microfinance in Jinja Municipality.

The study was conducted using a cross sectional survey research design and a total of 77 respondents took part in the study. Data were collected using questionnaires and interview guides and analyzed with the aid of SPSS software version 16. The study findings revealed that loan products have had a small percentage contribution (12%) to the socio-economic growth of the entrepreneur clients. The contribution of the saving products and money transfer services are of a significant value in as far as they make easy the flow of money among the targeted clients most of whom are entrepreneurs. It was concluded that the microfinance products offered by Pride Microfinance have the potential to translate into a significant improvement in the socio-economic growth attained by the targeted clients. The study recommended that Microfinance Institutions should make their services more accessible and friendly to the clients.