Return to Micro‐credit on Small‐scale Businesses: A Case Study of Ghanaian MFI

Abstract

The paper uses two rounds of survey to examine the relative returns to micro-credit for small-scale businesses in two regions of Ghana. Propensity scores matching and the nearest neighbour matching are used to assess the return to micro-loans on retail businesses of clients and non-clients. Micro-credit impacts on sales, stock, expenses and profit for clients as compared with non-clients. Women-owned businesses produce higher returns from micro-credit than men-owned businesses. Individual and enterprise characteristics influence access to micro-credit. The paper offers policy recommendations to microfinance institutions on whom and which business activity to give credit.

Impact of Microfinance Loans on the Performance of Smes: The Case of Lebanon

“…In any case, the H1.d: it exist an idealistic implication between micro loans and STK of the SME, is acknowledged. The outcomes are in accordance with the investigation of (Peprah & Ayayi, 2016). The independent variable is Amount_of_Loan A solid relationship between amount of loan and liquidity of the organization with 0.778.…”

“…Hereafter, the theory, H1.e: there is a positive connection between miniaturized scale loan and liquidity of the SMEs, is acknowledged. The outcome is like Rono (2018) and Saleem and Rehman (2011), refered to in Peprah and Ayayi (2016). The independent variable is Amount_of_Loan A solid relationship between amount of loan and turnover of the organization with 0.697.…”

“…The independent one is micro loans from MFIs. While the dependents are: own resources, liability, total assets, stock, liquidity, turnover, and net profit (Peprah & Ayayi, 2016;Florido et al, 2015;Rono, 2018). Analysis of data was completed in 4 stages.…”

“…Hence the theory, H1.g: microfinance credits influence positively the NP, is acknowledged. The outcome is predictable with Monge (2016), Rono (2018), Pei-Wen et al (2016), Peprah andAyayi (2016), Priya (2006), refered to in Peprah and Ayayi, 2016) and Akram and Hussain (2011).…”

“…Document and content analysis is a suitable strategy that will be utilized with a specific end goal to transform data collected into useful information with the assistance of the computer and software like SPSS in order to analyze and acquire answers to the questions. This paper explores the components that contribute in the financial performance of the SMEs which are also the dependent variables: own resources, liability, total assets, stock, liquidity, turnover, and net profit are utilized as pointers to gauge the dimension of progress in the SMEs execution (Peprah & Ayayi, 2016;Florido et al, 2015;Rono, 2018). The independent variable is the amount of micro loan.…”