SOCIO-ECONOMIC DETERMINANTS OF ERITREA’S SAVINGS AND MICRO CREDIT PROGRAM LOAN REPAYMENT PERFORMANCE: A CASE OF THE DEKEMHARE SUZ-ZONE

Abstract

The Savings and Micro Credit Program of Eritrea was established to provide financial services to the poor and lower income individuals to enhance their business activities and alleviate poverty level. The study analyzed the socio-economic factors that affect the institution’s loan repayment performance and a sample of 140 beneficiaries was fixed from the Dekemhare Sub-Zone using the Stratified Sampling technique. A structured questionnaire was used to collect the primary data and descriptive statistics and the probit model were employed to analyze the data. Results of the regression analysis revealed that the level of education, loan amount and loan category have insignificant effect on the probability of the SMCP loan repayment. On the other hand age, gender, type of business and credit experience are significant determinants where age and type of business have negative relationship and gender and credit experience have positive relationship with the loan repayment probability

Keywords: Eritrea, Loan Repayment Performance, Microcredit, Microfinance, Probit, Savings and Micro Credit Program


Article Review Status: Published

Pages: 48-63 (Download PDF)

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