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Microfinance for Entrepreneurial Development pp 73–85Cite as

Palgrave Macmillan

Perception of Microfinance Debtors and Loan Officers on the Importance of Entrepreneurial and Business Skills for Loan Repayment Rates

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Abstract

Entrepreneurial and business skills are widely recognized as important prerequisites for successful microbusiness entrepreneurship in developing countries and, therefore, loan repayment rates of microfinance institution (MFI) debtors. In the literature, it remains, however, unclear exactly what set of skills are most important. The present paper examines the extent to what microfinance debtors and loan officers agree on the relevance of various entrepreneurial and business skills for microbusiness performance and loan repayment. Results from two focus group discussions show that neither microfinance debtors nor loan officers agree on the ranking of skills. This suggests that microfinance debtors have specific needs for training and skills development, which, consequently, should be addressed on an individual basis. For loan officers to be effective in their duties of evaluating loan applications and supporting microfinance debtors, they need training to better understand the relevance of entrepreneurial and business skills for microfinance debtors’ loan repayment probabilities.

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Author information

Authors and Affiliations

  1. University of Wageningen, Wageningen, The Netherlands

    Daniel Agbeko

  2. Management Studies Group, School of Social Sciences, Wageningen University, Wageningen, The Netherlands

    Vincent Blok

  3. Wageningen University Management Studies, De Leeuwenborch, Wageningen, The Netherlands

    S. W. F. Omta

Authors
  1. Daniel Agbeko
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  2. Vincent Blok
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  3. S. W. F. Omta
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  4. G. Van der Velde
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Editor information

Editors and Affiliations

  1. Schulich School of Business, York University, Toronto, Ontario, Canada

    Douglas Cumming

  2. Aberystwyth University Business School, Aberystwyth, Surrey, United Kingdom

    Yizhe Dong

  3. University of Edinburgh Business School, Edinburgh, United Kingdom

    Wenxuan Hou

  4. Bangladesh Institute of Development Studies, Dhaka, Bangladesh

    Binayak Sen

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Agbeko, D., Blok, V., Omta, S.W.F., Van der Velde, G. (2017). Perception of Microfinance Debtors and Loan Officers on the Importance of Entrepreneurial and Business Skills for Loan Repayment Rates. In: Cumming, D., Dong, Y., Hou, W., Sen, B. (eds) Microfinance for Entrepreneurial Development. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-62111-1_4

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  • DOI: https://doi.org/10.1007/978-3-319-62111-1_4

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  • Publisher Name: Palgrave Macmillan, Cham

  • Print ISBN: 978-3-319-62110-4

  • Online ISBN: 978-3-319-62111-1

  • eBook Packages: Economics and FinanceEconomics and Finance (R0)

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