THE IMPACT OF MICROFINANCE INSTITUTIONS ON PERFORMANCE OF MICROENTERPRISES AND HOUSE HOLD WELFARE: A CASE OF MUFINDI COMMUNITY BANK, IRINGA REGION

Poor accessibility and low participation in credit markets by African entrepreneurs is Q.elieved to have significant negative consequences on various aggregate and household-1evel outc<;>mes including technology adoption, agricultural productivity, food security and overall household welfare (Temu, 1994; Zeller, 2001; Diagne, 2003, Atieno, 2001). It has long been recognized that without well functioning financial markets there is little prospectJor increasing enterprise productivity and improving the living standards of the. African: mral poor in any significant and sustainable way (Yunus, 1984). Most people believe that the m_icro finance institutions will reduce poverty through increased income and standards of living, . empowering women, developing the business sector through growth potentials and developing a. parallel financial sector (Kimuyu, 1999; Seibel and
Parnhu~ip, 1998; Khandker, 2000)