| dc.description.abstract | Microfinance services have been identified as developmental tools, aimed at reducing poverty by
bringing significant improvement in the living standards of the vulnerable people in society. The
principal objective of the microfinance program is to provide skills and opportunities for the poor
to access financial services permitting them to engage in various income-generating projects,
thereby improving their welfare. This study sought to examine the effect of microfinance
services on the living standards of low-income earners in Ngozi province of Burundi. The
objectives of this study were to examine the effect of loans on the living standards, to assess the
effect of savings on the living standards, and to examine the effect of trainings on the living
standards improvement in Ngozi province, focusing on the services of Twitezimbere
Microfinance to its clients.
A conceptual framework developed by Dwight and Lieden (2013) was modified for this study to
give a theoretical explanation on the relationship between loans, savings and training with living
standards. Both qualitative and quantitative data were collected using the interview and
questionnaire methods. A survey design was also used and a structured questionnaire was
designed on a five point Likert scale and distributed to 156 respondents that were selected from a
target population of 255 respondents using purposive sampling technique. Collected data was
processed using the Statistical Package for Social Sciences (SPSS, version 16). The study
findings were analyzed and presented in tables using frequencies, percentages, mean and
standard deviations. Pearson’s correlation analysis was used to conclude on the relationship and
the level of significance between dependent variables and independent variables. Regression
analysis model was also used to assess the extent to which independent variables predicted
variance into the dependent variables.
The study revealed that access to microfinance services such as loans, savings and trainings has
led to improvement in the living standards of the clients of Twitezimbere Microfinance in the
areas of healthcare, nutrition and sanitation, housing as well as improved incomes. This was
indicated by a moderate positive relationship between loans offered by Twitezimbere
Microfinance to its clients with (R = 0.471, P=0.000) at a significance level of 0.01.The study
showed also a moderate positive relationship between savings with Twitezimbere and living
standards with (R= 0.522, P= 0.000). The study showed a weak positive relationship between
trainings of Twitezimbere microfinance and living standards to its clients indicated by R=0.390
and P=0.000. Finally it indicated that in terms of living standards, savings is considered as the
highest predictor (β=0.310) followed by loan (β=0.224) while training had less significant force
(β =0.181).
Consequently, it is concluded that microfinance services have a positive and a significant effect
on the living standards in Ngozi Province. The microfinance services have not only helped
clients of Twitezimbere to overcome their socio-economic challenges, but have helped them to
get empowered. The study recommends MFIs operating in Burundi, especially Twitezimbere
Microfinance, to undertake several trainings on financial management courses so that clients can
learn the best financial management skills and thus improve their businesses which lead to higher
income hence leading to improved living standards in Ngozi Province. | en_US |
