Luoga, Stella Emilian
(2013)
Loan delinquency and repayment performance for Mchikichini and TADA SACCOS found at Ilala municipal Dar es Salaam.
Masters thesis, The Open University of Tanzania.
Abstract
The main objective of this study is to assess loan Delinquency and the factors that influence non performing the repayment of SACCOS loan. The study assesses the factors causing non repayment of loan to SACCOS members; examine the level of loan repayment performance of their members. Also to assess whether the aspect used by SACCOS to force borrowers repaying the loan on time is suitable. A total of 120 questionnaires were administered to members of Mchikichini and TADA traders SACCOS at Ilala SACCOS.A total of 66 respondents were successfully interviewed or return the questionnaires. Analysis of data revealed that there is a problem in loan repayment performance to SACCOS members. Factors identified for the poor loan repayment was as follows: The diversion of loan funds by borrowers, non supervision of loan, on effective loan utilization and the time for repayment period was not enough. It was also found that traders SACCOS annual interest rate were moderate. Nevertheless the mechanism used to assist in loan utilization and repayment is not effective enough. The study recommended that traders SACCOS leaders should make sure that members use loan for intended purpose through having monthly routine of visiting their businesses. SACCOS leaders should educate their members on selecting profitable business which will provide them a lot of profit. Higher profit will enable them to overcome other need of money. Leaders should advise their members to avoid credit sales Also loan repayment time should be reasonable and in accordance to the amount of loan received and Management staff should be professional and competent to their duties.
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