The Role of Addis Credit and Saving Institution in Urban Poverty Reduction: the case ofworeda one ofYeka sub city, Addis Ababa
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Date
2012-11
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Addis Ababa University
Abstract
The major purpose of this study is to assess the role of Addis Credit and Saving
Institution in urban poverty reduction. Poverty is widely prevalent problem in urban and
rural area of Ethiopia. Hence the government of Ethiopia took micro finance institutions
as one of the solutions so as to reduce the level of poverty in the country and issued the
first micro finance legislation in 1996 (proclamation 40/96). AdCSI is one of the 27
micro finance institutions that have been operating in Ethiopia. There is no a research
specifically done on the role of Addis Credit and Saving Institution in urban poverty
reduction. Thus, this gap initiated the researcher to conduct study on the role of AdCSI in
urban poverty reduction. Descriptive survey method was employed to conduct the
------crc-e:csce""accrccc:..,h·. To gather data lOitlie study questIOnnaire, interview, locus group discussi"o"nC=-and
life history have been applied. Systematic random sampling method was used to
select sample respondents. From the total population of 1,610 clients a sample size of
310 was selected using Krejcie and Morganformula and questionnaires were distributed.
Data obtained through the questionnaire have been analyzed with descriptive statistics
(mean and frequency). Moreover the data obtained using the interview and focus group
discussion have been analyzed qualitatively. The study revealed that Addis Credit and
Saving Institution has not properly outreached the poorest of the poor segment of the
society. But improvements are observed more on the upper poor (who used to earn above
$ 1.25 per day) in income, employment opportunity creation, medical facilities,
educational facilities, expenditure, gender empowerment and savings. However,
improvement relating to housing condition is less compared to other effects. In general
the respondent clients have observed positive change following their micro finance use in
all aspects. But there is much untapped potential for improvement in these respects
beyond what has been achieved so far. The institution should also revise its client
selection criteria so as to outreach more to the real destitute. In addition, it should
attempt to solve obstacles that prohibit borrowers from taking enough amount of loan
size to run their business properly
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Role of Addis Credi