Impacts of Micro Finance on the Livelihood of Households, Particularly Women: The Case of Adea Liben Woreda
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Date
2006-07
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Addis Ababa University
Abstract
Poverty is highly affecting the life 's of the population of Less Developed Countries (LDCs) in
general and that of rural women in particular. High vulnerab ili ty, lack of education and medical
services, less participation in different decision-making activities are some of the major problems
the rural women faced. They are •. Iso economicall y, socially, cultura ll y and politically
marginalized. To overcome these and other related socio-economic problems, Micro finance
Institutions (MFls) targeted the poor in general and the rural women in particular.
This study is aimed to examme the impact of Oromia Credit and savll1g Share Company
(OCSSCo) services on the life of women clients in rural areas of Oromia region. It is assumed
that, the impact of the intervention of MFis could be observed at household, indi vidual,
enterprise and community levels. The rationale for using household, indi vidual, enterprise and
community as units of impact assessment is that, any institutional services that are aimed to
provide financial services for the sake of poverty all eviation, its end effect is measured by the
changes appeared on the lives of its cli ents. These clients are part of the household and the
society in which they live. Therefore, household situations affect the activities of individual s. On
the other hand, the impact of Micro finance (MF) intervention can be observed by the
composi tion of the household, and due to one of their economic acti vi ti es.
The study used a case Shldy method taking Adea Liban Worked as a sample. It included all
women cli ents who stayed in the program for one to five years. It also covered 8 rural kebeles of
40 centers. The number of participants is 220 women clients, 24 informant groups and 7
OCSSCo members. Almost, all women client respondents are similar in their characteristics.
Out of the to tal 220 client respondents, 11 6 of them were interviewed; where as 104 of them were
participated in fc eus group discussions IFGDs). The informant groups were participated in FGDs.
Besides, 7 OCSSCo staff members were interviewed. For all respondents structured
questionnaires (open-ended and closed-ended) were used as an instrument. Observation of cli ents
living situations was used in order to crosscheck the opinions given by the clients. During the discussion process, women clients living situation before and after their participation in the
program were raised and responded by women clients and infolmant groups.
Respondents were selected using purposive sampling techniques. In some centers, the number of
women clients were less than the minimum standard required to conduct FGDs. Due to this
reason, two and more centers were combined together and conducted FGDs. Hence, there were a
total of 10 FGDs taken place.
The result of the intervention of OCSSCo through financial services shows positive outcomes on
the lives of women clients and their households. The provided loan also improved women socioeconomic
and personal empowennents. The consumption of clients and their households is
smoothed, and their living standards ore slightly improved in terms of living house, medical
services, and sanitation, and they send their children to school better than before. Their selfImage,
self-confidence, decision-making capabilities and saving culture show slight
improvements.
Some interventions such as skill training, improving loan size (selling), saving culture and close
supervisions are very important in order to ensure the benefits of the targeted groups.
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Keywords
Micro Finance on the, Livelihood of Households