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Customer satisfaction in microfinance institutions: insights from Ghana

Customer satisfaction in microfinance institutions: insights from Ghana
Customer satisfaction in microfinance institutions: insights from Ghana
With increased competition in the microfinance industry in most African markets, customer satisfaction and retention are important issues for most microfinance institutions (MFIs) in the region. We rely on survey data from customers of MFIs in Ghana to examine the potential determinants of customer satisfaction in the microfinance sector. We find customer satisfaction to be significantly related to customers’ experiences and motivations such as the primary reason for associating with MFIs, and the size of credit they seek. We further find customers’ demographic factors such as educational attainment and household income levels to be related to customer satisfaction in the microfinance sector. Our results are largely consistent with the view that MFIs offer a valuable service by expanding access to small credits to poor households and microenterprises who are either denied credit by the formal banking sector or who are exploited by informal moneylenders. Further, our interviews with top managers of MFIs highlight various tactics utilised by MFIs in Ghana to manage their credit risks.
1755-1986
Agyei-Boapeah, Henry
37005f29-d453-458e-b6b5-cd92e55587a4
Adu-Boakye, Stella
9ced7bda-bf7d-43a2-b6d4-ad597126a255
Amankwah-Amoah, Joseph
d2ad1a30-774b-4d63-b77f-4e66976666da
Brodmann, Jennifer
7926205a-e964-4b49-adb5-6bac15fe2417
Agyei-Boapeah, Henry
37005f29-d453-458e-b6b5-cd92e55587a4
Adu-Boakye, Stella
9ced7bda-bf7d-43a2-b6d4-ad597126a255
Amankwah-Amoah, Joseph
d2ad1a30-774b-4d63-b77f-4e66976666da
Brodmann, Jennifer
7926205a-e964-4b49-adb5-6bac15fe2417

Agyei-Boapeah, Henry, Adu-Boakye, Stella, Amankwah-Amoah, Joseph and Brodmann, Jennifer (2020) Customer satisfaction in microfinance institutions: insights from Ghana. Enterprise Development and Microfinance. (In Press)

Record type: Article

Abstract

With increased competition in the microfinance industry in most African markets, customer satisfaction and retention are important issues for most microfinance institutions (MFIs) in the region. We rely on survey data from customers of MFIs in Ghana to examine the potential determinants of customer satisfaction in the microfinance sector. We find customer satisfaction to be significantly related to customers’ experiences and motivations such as the primary reason for associating with MFIs, and the size of credit they seek. We further find customers’ demographic factors such as educational attainment and household income levels to be related to customer satisfaction in the microfinance sector. Our results are largely consistent with the view that MFIs offer a valuable service by expanding access to small credits to poor households and microenterprises who are either denied credit by the formal banking sector or who are exploited by informal moneylenders. Further, our interviews with top managers of MFIs highlight various tactics utilised by MFIs in Ghana to manage their credit risks.

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Accepted/In Press date: 22 July 2020

Identifiers

Local EPrints ID: 442753
URI: http://eprints.soton.ac.uk/id/eprint/442753
ISSN: 1755-1986
PURE UUID: 8ea6e6ab-b4f3-4eea-92df-914bddefc931
ORCID for Henry Agyei-Boapeah: ORCID iD orcid.org/0000-0003-4798-6324

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Date deposited: 24 Jul 2020 16:46
Last modified: 18 Feb 2021 17:40

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Contributors

Author: Henry Agyei-Boapeah ORCID iD
Author: Stella Adu-Boakye
Author: Joseph Amankwah-Amoah
Author: Jennifer Brodmann

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