Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania

Ali Othman Abbas; Ji Wei Li

doi:doi:10.11648/j.ijafrm.20170202.16

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Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania

Ali Othman Abbas, Ji Wei Li

Published in International Journal of Accounting, Finance and Risk Management (Volume 2, Issue 2)

Received: 31 March 2017 Accepted: 25 April 2017 Published: 30 May 2017

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Abstract

The objective of this study was to illustrate, the constraints in accessing credit for SMEs to acquire capital from micro financial institutions as regards business capacity, default risk premium, and liquidity risk premium. The plan, which was engaged in this study, was descriptive assessment. The aim of adopting this method was to gather comprehensive, systematic and in-depth information about the restriction of SMEs to access credit from MFIs. The sample size of the study was 100 SME’s known as (clients) and 50 MFI’s operated in Tanzania. Data were collected through a questionnaire and interview. SPSS software was used for data analysis. There was a strong negative correlation between default risk premium and liquidity risk premium and positive correlation between business capacity and loan repayment. The study recommended that in order to reduce the burden of interest amount to be paid by their clients, MFIs should be reduced interest rate to cover its costs and obtain normal profits, also should train their clients about business knowledge, the importance of keeping business records and techniques of valuing business capacity to enable their clients to measure their business capacity and know the appropriate amount of loan to be applied for their businesses.

Published in	International Journal of Accounting, Finance and Risk Management (Volume 2, Issue 2)
DOI	10.11648/j.ijafrm.20170202.16
Page(s)	84-91
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Microfinance Institutions, Business Capacity, Default Risk Premium, Liquidity Risk Premium, Loan Repayment and Interest Rate

References

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APA Style

Ali Othman Abbas, Ji Wei Li. (2017). Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. International Journal of Accounting, Finance and Risk Management, 2(2), 84-91. https://doi.org/10.11648/j.ijafrm.20170202.16

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ACS Style

Ali Othman Abbas; Ji Wei Li. Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. Int. J. Account. Finance Risk Manag. 2017, 2(2), 84-91. doi: 10.11648/j.ijafrm.20170202.16

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AMA Style

Ali Othman Abbas, Ji Wei Li. Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. Int J Account Finance Risk Manag. 2017;2(2):84-91. doi: 10.11648/j.ijafrm.20170202.16

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@article{10.11648/j.ijafrm.20170202.16,
  author = {Ali Othman Abbas and Ji Wei Li},
  title = {Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania},
  journal = {International Journal of Accounting, Finance and Risk Management},
  volume = {2},
  number = {2},
  pages = {84-91},
  doi = {10.11648/j.ijafrm.20170202.16},
  url = {https://doi.org/10.11648/j.ijafrm.20170202.16},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijafrm.20170202.16},
  abstract = {The objective of this study was to illustrate, the constraints in accessing credit for SMEs to acquire capital from micro financial institutions as regards business capacity, default risk premium, and liquidity risk premium. The plan, which was engaged in this study, was descriptive assessment. The aim of adopting this method was to gather comprehensive, systematic and in-depth information about the restriction of SMEs to access credit from MFIs. The sample size of the study was 100 SME’s known as (clients) and 50 MFI’s operated in Tanzania. Data were collected through a questionnaire and interview. SPSS software was used for data analysis. There was a strong negative correlation between default risk premium and liquidity risk premium and positive correlation between business capacity and loan repayment. The study recommended that in order to reduce the burden of interest amount to be paid by their clients, MFIs should be reduced interest rate to cover its costs and obtain normal profits, also should train their clients about business knowledge, the importance of keeping business records and techniques of valuing business capacity to enable their clients to measure their business capacity and know the appropriate amount of loan to be applied for their businesses.},
 year = {2017}
}

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TY  - JOUR
T1  - Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania
AU  - Ali Othman Abbas
AU  - Ji Wei Li
Y1  - 2017/05/30
PY  - 2017
N1  - https://doi.org/10.11648/j.ijafrm.20170202.16
DO  - 10.11648/j.ijafrm.20170202.16
T2  - International Journal of Accounting, Finance and Risk Management
JF  - International Journal of Accounting, Finance and Risk Management
JO  - International Journal of Accounting, Finance and Risk Management
SP  - 84
EP  - 91
PB  - Science Publishing Group
SN  - 2578-9376
UR  - https://doi.org/10.11648/j.ijafrm.20170202.16
AB  - The objective of this study was to illustrate, the constraints in accessing credit for SMEs to acquire capital from micro financial institutions as regards business capacity, default risk premium, and liquidity risk premium. The plan, which was engaged in this study, was descriptive assessment. The aim of adopting this method was to gather comprehensive, systematic and in-depth information about the restriction of SMEs to access credit from MFIs. The sample size of the study was 100 SME’s known as (clients) and 50 MFI’s operated in Tanzania. Data were collected through a questionnaire and interview. SPSS software was used for data analysis. There was a strong negative correlation between default risk premium and liquidity risk premium and positive correlation between business capacity and loan repayment. The study recommended that in order to reduce the burden of interest amount to be paid by their clients, MFIs should be reduced interest rate to cover its costs and obtain normal profits, also should train their clients about business knowledge, the importance of keeping business records and techniques of valuing business capacity to enable their clients to measure their business capacity and know the appropriate amount of loan to be applied for their businesses.
VL  - 2
IS  - 2
ER  -

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Author Information

Ali Othman Abbas

School of Accountancy, Jiangxi University of Finance and Economics, Nanchang, China
Ji Wei Li

School of Accountancy, Jiangxi University of Finance and Economics, Nanchang, China

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Plain Text BibTeX RIS

APA Style

Ali Othman Abbas, Ji Wei Li. (2017). Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. International Journal of Accounting, Finance and Risk Management, 2(2), 84-91. https://doi.org/10.11648/j.ijafrm.20170202.16

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ACS Style

Ali Othman Abbas; Ji Wei Li. Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. Int. J. Account. Finance Risk Manag. 2017, 2(2), 84-91. doi: 10.11648/j.ijafrm.20170202.16

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AMA Style

Ali Othman Abbas, Ji Wei Li. Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania. Int J Account Finance Risk Manag. 2017;2(2):84-91. doi: 10.11648/j.ijafrm.20170202.16

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@article{10.11648/j.ijafrm.20170202.16,
  author = {Ali Othman Abbas and Ji Wei Li},
  title = {Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania},
  journal = {International Journal of Accounting, Finance and Risk Management},
  volume = {2},
  number = {2},
  pages = {84-91},
  doi = {10.11648/j.ijafrm.20170202.16},
  url = {https://doi.org/10.11648/j.ijafrm.20170202.16},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijafrm.20170202.16},
  abstract = {The objective of this study was to illustrate, the constraints in accessing credit for SMEs to acquire capital from micro financial institutions as regards business capacity, default risk premium, and liquidity risk premium. The plan, which was engaged in this study, was descriptive assessment. The aim of adopting this method was to gather comprehensive, systematic and in-depth information about the restriction of SMEs to access credit from MFIs. The sample size of the study was 100 SME’s known as (clients) and 50 MFI’s operated in Tanzania. Data were collected through a questionnaire and interview. SPSS software was used for data analysis. There was a strong negative correlation between default risk premium and liquidity risk premium and positive correlation between business capacity and loan repayment. The study recommended that in order to reduce the burden of interest amount to be paid by their clients, MFIs should be reduced interest rate to cover its costs and obtain normal profits, also should train their clients about business knowledge, the importance of keeping business records and techniques of valuing business capacity to enable their clients to measure their business capacity and know the appropriate amount of loan to be applied for their businesses.},
 year = {2017}
}

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TY  - JOUR
T1  - Constraints in Accessing Credit for SMEs to Acquire Capital from Microfinacial Institution’s -Tanzania
AU  - Ali Othman Abbas
AU  - Ji Wei Li
Y1  - 2017/05/30
PY  - 2017
N1  - https://doi.org/10.11648/j.ijafrm.20170202.16
DO  - 10.11648/j.ijafrm.20170202.16
T2  - International Journal of Accounting, Finance and Risk Management
JF  - International Journal of Accounting, Finance and Risk Management
JO  - International Journal of Accounting, Finance and Risk Management
SP  - 84
EP  - 91
PB  - Science Publishing Group
SN  - 2578-9376
UR  - https://doi.org/10.11648/j.ijafrm.20170202.16
AB  - The objective of this study was to illustrate, the constraints in accessing credit for SMEs to acquire capital from micro financial institutions as regards business capacity, default risk premium, and liquidity risk premium. The plan, which was engaged in this study, was descriptive assessment. The aim of adopting this method was to gather comprehensive, systematic and in-depth information about the restriction of SMEs to access credit from MFIs. The sample size of the study was 100 SME’s known as (clients) and 50 MFI’s operated in Tanzania. Data were collected through a questionnaire and interview. SPSS software was used for data analysis. There was a strong negative correlation between default risk premium and liquidity risk premium and positive correlation between business capacity and loan repayment. The study recommended that in order to reduce the burden of interest amount to be paid by their clients, MFIs should be reduced interest rate to cover its costs and obtain normal profits, also should train their clients about business knowledge, the importance of keeping business records and techniques of valuing business capacity to enable their clients to measure their business capacity and know the appropriate amount of loan to be applied for their businesses.
VL  - 2
IS  - 2
ER  -

Copy | Download