The impact of microfinance activities in Dar Es Salaam : a case of Dar Es Salaam Community Bank Limited and Pride Tanzania

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Southern New Hampshire University
This research has been carried out with a focus to evaluate the performance and impact of two micro finance institutions i.e. Dar es Salaam Community Bank, and Pride Tanzania in Dar es Salaam. Having regard to the successful stories of micro finance institutions else where in the world, the Grameen Bank in Bangladesh, BRI in Indonesia, Prodem in Bolivia where millions of poor people have changed their lives through these Institutions, the writer became curious to study on the two local micro finance institutions, Pride Tanzania and Dar es Salaam Community Bank.The issues of evaluation were focused to measure the impact on the following important factors: -Job creation To see to what extent the two institutions have financed communities in Dar es Salaam leading to promotion of employment and job creation. -Income growth and distribution To investigate how the financial institutions through their deposits and interests payments have influenced income growth and distribution to their clients. -Women Empowerment Evaluate to what extent women have benefited from loans given by the two institutions. Problems faced by clients of the two Institutions regarding services. Study from the clients perspective problems they face in accessing to loans interest such as charges and how these problems can be alleviated by the two institutions.. Difference between Pride Tanzania as a NGO and Dar es Salaam Community Bank as a regulated Bank. The study has identified the differences between the two Institutions one being an NGO whereby it is not allowed to collect voluntary savings from the public, instead it collects forced savings to act as Insurance for the loans disbursed to its clients. The study has revealed that due to this difference Dar es Salaam Community Bank has been able to collect Tshs. 12.5bn in three years against l0bn collect by Pride Tanzania in 11 years. The other difference is that Pride Tanzania is donor dependant to-date while DCB is not donor funded. In summary the study has concluded that the two institutions had significant impact to the four factors tested and that they have played a key role in the poverty alleviation struggle in Dar es Salaam. (Author abstract)