ABSTRACT
The overall performance of youth group income generating projects in Wajir County has been declining drastically as measured by asset growth rates and sales turnover growth rate. According to the Kenya National Bureau of Statistics (2019) the asset base of youth group income generating projects decreased from 5.23 percent in 2017 to 5.01 percent in 2018. The sales turnover decreased from Kshs 13.21 million in 2017 to Kshs 8.57 million in 2018. The general objective of the study was to determine the effect of microfinance access on the performance of youth groups‟ income generating projects in Wajir County. Specifically, it sought to determine the effect of interest rates, collateral requirement and lending procedure on the performance of youth groups‟ income generating projects in Wajir County, Kenya. The study was guided by Welfarist theory, credit market theory and Joint liability theory. The study used descriptive cross sectional research design. The target population was 62 youth groups dealing with income generating projects in Wajir County. Purposive sampling was used to select two persons that were the chairperson and the treasurer from each of the youth group income generating project hence the sample size of 124 participants. Data was collected using questionnaires and was analyzed using descriptive that included percentage, mean and standard deviationand. To establish the relationship between the variables, regression analysis was used.The findings indicated that most youth group income generating projects were affected by interest rates which affected their capacity to borrow, affected their capacity to repay loan and also increased the cost of borrowing loan. Most of the youth group income generating projects were found to lack or have insufficient collateral that could not guarantee the group access to finance from microfinance institutions. To a great extent collateral requirement affected the performance of youth group income generating projects. Lending procedures was found to have least variable affecting the performance of youth group income generating projects. Most of the youths did not consider lending procedures as a major hindrance to finance access. In conclusion, there is need to reduce interest rates for the loans advanced to youth group income generating projects. Microfinance institutions should not be strict on collateral issues to youth groups. They should use other criteria‟s such as inter-member guarantee to give out loans to these youth groups. For lending procedures, microfinance institutions should make the procedures short and clear. This would attract youth group income generating projects in borrowing and accessing loans from microfinance institutions. This study recommends that the interest charged on credit facilities should be reviewed downwards, the requirement for non-collateral or credit worthiness should be applied for youth groups and lastly microfinance institutions should consider effective lending policies on youth projects. The study contributes to knowledge gap by providing useful information that the microfinance institutions may use to improve policy on access to credit by youth group income generating projects. The study suggests future researchers to investigate the relationship between the interest rate charged on loan and sales turnover of youth groups‟ income generating projects.
ALI, H (2021). Microfinance Access And Performance Of Youth Group Income Generating Projects In Wajir County, Kenya. Afribary. Retrieved from https://afribary.com/works/microfinance-access-and-performance-of-youth-group-income-generating-projects-in-wajir-county-kenya
ALI, HASSAN "Microfinance Access And Performance Of Youth Group Income Generating Projects In Wajir County, Kenya" Afribary. Afribary, 01 Jun. 2021, https://afribary.com/works/microfinance-access-and-performance-of-youth-group-income-generating-projects-in-wajir-county-kenya. Accessed 08 Sep. 2024.
ALI, HASSAN . "Microfinance Access And Performance Of Youth Group Income Generating Projects In Wajir County, Kenya". Afribary, Afribary, 01 Jun. 2021. Web. 08 Sep. 2024. < https://afribary.com/works/microfinance-access-and-performance-of-youth-group-income-generating-projects-in-wajir-county-kenya >.
ALI, HASSAN . "Microfinance Access And Performance Of Youth Group Income Generating Projects In Wajir County, Kenya" Afribary (2021). Accessed September 08, 2024. https://afribary.com/works/microfinance-access-and-performance-of-youth-group-income-generating-projects-in-wajir-county-kenya