The impact of microfinance on women borrower's livelihoods : a case of BRAC Uganda

Abstract

The study examined the impact of BRAC microfinance credit schemes on poor women borrowers’ livelihoods in Kabarole District. The objectives of the study were to: examine credit facilities offered by BRAC Uganda that are accessible to borrowers especially women; assess the effect of BRAC lending terms on women’s access to and payment of credit, and assess the extent to which BRAC microfinance credit facilities improve women’s livelihoods. The study employed a cross-sectional study design. Data were collected through a survey and interviews. Key information was collected from four BRAC employees and four group leaders who were purposively selected, and 102 women borrowers of four selected groups of BRAC microfinance institutions that participated in the survey. The key findings of the study indicated that BRAC Uganda Bank Limited offers credit services that have made some improvements in the women borrower’s livelihoods in varying ways. These credit facilities include: micro/ group loans and individual loans. As a result of these credit facilities, some benefits have subsequently been attained e.g. women’s ability to save on a weekly basis, acquisition of some property like land, houses, domestic animals, and an improvement in women borrower’s lives. The study also discovered flaws and challenges (lending terms) associated with the operations of BRAC microfinance institutions, which limit women in accessing and servicing their loans. The women cited the group dynamics, short re-payment periods and weekly remittances being unbearable, increase in women’s workload which reduces productivity, some women using loans to settle their immediate needs such as renovating a house and paying school fees for their children. In light of the above findings, it is therefore recommended that BRAC address the apparent challenges and flaws to mitigate the negative impact of such deficiencies in their performance and loan uptake by the women borrowers.