The Impact of Microfinance Non-financial Services on Socio-Economic and Environmental Status of the Low-Income Households in Kicukiro District, Rwanda

Prof Gustave Tombola M. – University of Tourism, Technology and Business Studies (UTB), Rwanda, Mr. Mpambara Frederic – University of Rwanda (UR), College of Business and Economics (CBE) and Dr. Mutasa Felician – Open University of Tanzania (OUT)
Email: tomgust74@yahoo.fr or proftombola06@gmail.com

Received May30, 2020; Reviewed June5, 2020; Accepted June7, 2020

Abstract:This study evaluated the impact of microfinance non-financial services on the socio-economic and environmental status (SEES) of low-income households in Kicukiro District, Rwanda. Precisely, it examined “the extent to which SEES of deep-rooted MFI clients exceeds that of non-MFI clients in Kicukiro District, Rwanda.” This study is impartant due to the fact that the non-financial services coupled to financial services allow low-income households to optimally invest, aquire productive assets and increase their management skills.The study used mixed methods research to attain the objective. It collected quantitative data using a structured questionnaire (schedules) from the intervention group of 389 households (deep-rooted MFI clients) and a regulator group of 111 households (non-MFI clients) . This research used SPSS version 22 for quantitative analysis. The correlation analysis revealed that the microfinance NFS affects the SEES at (0.073) Pearson correlation coefficient with 0.152 p-values. The independent t-test showed that, on average, the SEES of deep-rooted MFI clients was 2.246 million SEES higher than that of the non-MFI clients; t (249.47) = 5.83 with p = .000. This study used NVivo 10 to analyze data from in-depth interviews and focus group discussions thematically. The qualitative findings triangulate the quantitative results. This study concludes that microfinance non-financial services have a low negative and insignificant impact. It recommends that MFIs should make sure that they associate non-financial with financial services. Moreover, policymakers and regulators should reinforce the policy to promote much more non-financial services models to enhance the financial capabilities of their clientele.