Browsing by Author "Endale Degefe"

Now showing 1 - 1 of 1
  • No Thumbnail Available
    Item
    The Determinants of Micro enterprise Loan Repayment in Addis Ababa: A Case Study of Gulele Sub-City.
    (A.A.U, 2007-02) Endale Degefe; Paramaiah Ch
    The purpose of the study is to look into the determinants of microenterprise loan repayment in Addis Ababa particularly to Gulele sUb-city. Loan repayment has paramount importance for most developing countries, because lack of financial resources is usually regarded as a major obstacle to the development of such countries.In addition good repayment performance is an important measure for the success of microfinance institution and icroenterprises.Hence, it is advisable to credit scheme initiatives to make more attention to investigate factors that influence loan repayment performance which enables the programs to reach millions of the poor. The objective of the study is to investigate the determinants of icroenterprise loan repayment in Addis Ababa with respect to Gulele Sub-city. The study is based on descriptive statistical analysis and identification of the determinants of microenterprise loan repayment in beneficiaries by using binomialprobit model. The data used in descriptive statistical analysis is primary data collected from a structured questionnaire from a sample of 220 borrowers who benefited from Gulele sibcity credit and saving office . The estimated binomial probit model indicates that, loan amount, household income, age of borrower, sex of borrowers and role of group leader are negatively related to loan repayment performance. On the contrary, suitability of installment period, supervisory vi sit, number of activities provide source of income, expectation of another loan, house hold income, availability of other source of income, social ties, frequency of loan, living distance among group members and high school and above high school level of education are positively related to loan repayment performance. Hence, factors that enhance and hinder loan repayment performance should be considered by Gulele sub-city credit and saving office in designing a more effective loan repayment mechanism for its borrowers.