LOAN REPAYMENT AND PERFORMANCE OF SACCOS IN TANZANIA: A SURVEY OF DODOMA MUNICIPAL

ABSTRACT

This study was carried out so as to analyze the repayment trend of members of

SACCOS taking Dodoma Municipality as a case study. Specifically, the study

focused on examining the factors influencing the repayinent of loans, the economic

activities undertaken by loanees and the measures taken to improve the repayment of

loans.

This study employed both cross sectional as well as a case study to get data about the

problem. The sample mainly consisted of 104 respondents who were obtained by

random sampling. The sample consisted of members of SACCOS. In addition few

staffs were contacted to give their views on the problem. Data collection method

included interviews and documentation review. The data analysis was through the use

of SPSS.

Based on the study it was found out that in most cases high interest rate and the use of

collateral were the major constraints for the repayment of loans on timely basis. The

main activities conducted by members as they get loans are small businesses such

food vending, shops as well as subsistence farming.

It was therefore recommended that the government and other stakeholders should

devise the conditions associated with issuing loans; the government should encourage

the lending institutions to expand the provision of loans so as to cover the rural areas;

the use of collateral should be revised so as to give room to many people to be able

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