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



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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Copyright information

© The Author(s) 2017

Authors and Affiliations

  1. 1.University of WageningenWageningenThe Netherlands
  2. 2.Management Studies Group, School of Social SciencesWageningen UniversityWageningenThe Netherlands
  3. 3.Wageningen University Management StudiesDe Leeuwenborch, WageningenThe Netherlands

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