Women and Micro Finance: The Case of Women Fuel Wood Carriers in Addis Ababa

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This study has two parts. The first part analyzes the impact of micro finance on the living and working conditions of women fuel wood carriers (WFCs). Descriptive statistical analysis, using primary data collected From a sample of 130 individual WFCs who are/were beneficiaries in either credit schemes, is employed in this part of the study. While assessing this impact it also examines whether micro finance can reduce the pressure that WFCs exert on the forest slack of the trees surrounding the city of Addis Ababa. The second part of the study, based on the above data, examines determinants of loan repayment performance by using a probity model. The results of the study indicate that the credit schemes have brought positive impact in improving the living and the 'working conditions of these 'women, thereby enhancing their economic empowerment. This is reflected in the rise of their income, expenditure and in their shift to other alternative income generating activities afire the loan rather than engaging in fuel wood collecting, carrying and selling activity. The study also indicates that micro finance only couldn’t stop these women from degrading the forest stock of the city as those women fuel wood carriers who do not have access to credit continue with this activity. hence, integrating these 'women into forest management or fuel wood plantation 011 the one hand and the provision of micro finance services to those WFCs who are in need of credit on the other hand would be essential to resolve these problems. Moreover, to minimize further drop out of the member and to operate in a sustainable manner, Gasha Micro financing Share Company (GMFSC) should have to carefully examine in its lending strategy the reasons for the increased dropouts of its beneficiaries and search a solution for the operational problems faced by them in running their business. The determinants of loan repayment performance as estimated by the binomial probate model indicates that educational level is negatively related to loan repayment performance while Frequency of loan (repeat borrowers), supervision, suitability of repayment installment period and other income sources are found to encourage repayments and reduce the probability of loan default. Hence, these repayment enhancing factors and other variable that affect repayment performance negatively should be considered by GMFSC in designing a more effective loan repayment mechanism for its beneficiaries.



Micro Finance, Women Fuel Wood Carriers