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 International Journal of Political Science and Development
 

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International Journal of Political Science and Development

Vol. 5(3), pp. 7379, May, 2017. 

DOI: 10.14662/IJPSD2017.011

ISSN: 2360-784X

 

 

Research Paper

 

Performance Evaluation of Omo Microfinance Institute in Southern Ethiopia

 

Muluken Philipos Borko

 

Wondo Genet Agricultural Research Center, Agricultural Research Process, P. O. Box 198, Shashemene.

E-mail: natinard.philip1@gmail.com

 

Accepted 2 May 2017

Abstract

 

Microfinance has been evolved as an economic development approach intended to benefit low income people. Therefore, the objective of this study was to assess the performance of Omo microfinance institute using the core performance indicators and to forward the possible recommendation to strengthen the performance of institute. This study pointed out that there was increment in the number of clients participated in the service delivery across years. The study also found out a negative impact on outreach to the poor and the participation of women clients was small. The results on financial sustainability measured by return on asset (0.02) and return on equity (0.06) showed there was difficulty in the institute profitably to sustain the business and in order to met it objectives in the long run. Under collection performance view, the study found out that a large percentage of PAR (11.78) and ALR (62.28%) which was beyond the threshold of 10 and 5 percent respectively. Therefore, the study concludes that the institute should focus on financial sustainability in order to reduce their subsidy dependence, ensure survival and growth in the future. To the policy makers, the study recommends that poverty alleviation programs need to be accompanied by a targeting strategy and a program structure appropriate to the needs of the poor.

Keywords: Micro-finance, Financial Service, Poverty, performance Indicators

 

Cite This Article As: Borko MP (2017). Performance Evaluation of Omo Microfinance Institute in Southern Ethiopia. Inter. J. Polit. Sci. Develop. 5(3): 73-79


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