Effect of Microfinance Services on Women Economic Empowerment in Rwanda Case Study: Vision Fund Rwanda in Kabuga Zone

Abstract

The main objective of the microfinance programme is to provide opportunity for the poor to access financial services in order to engage in income generating activities. This as it were, would lead to economic empowerment of the poor women who are deprived of the paid jobs. However, there has been a debate in recent times on whether these MFIs really provide the opportunity for women who forms majority of the poor all over the world to assess financial services thereby improving their welfare.

This study set out to assess the effect of MFIs on Women Economic Empowerment in Kabuga zone, Gasabo District of Rwanda. The objectives of the study were to examine the effect of loans provided by Vision Fund Rwanda on Women Economic Empowerment, to examine the effect of savings with Vision Fund Rwanda on Women Economic Empowerment and to examine the effect of financial trainings provided by Vision Fund Rwanda on Women Economic Empowerment in Kabuga Zone.

A structured questionnaire was designed on a five –point likert scale and distributed to 85 respondents that were selected from a target population of 85 respondents by using census sampling technique, key informant interviews was also conducted by collecting qualitative data of the study. Collected data was processed using statistical package for social scientists (SPSS version 16). The study findings were analyzed and presented in tables using frequencies, percentages, mean and standard deviations. Pearson’s correlation analysis was carried out to determine the relationship and level of significance between variables whereas multiple regression analysis model was used to measure the extent to which independent variable predicted variance into the dependent variable.

Findings from the study indicated that there is a moderate positive relationship between Loans provided by VFR and Women Economic Empowerment with (r = 0.685, p =0.000) at a significance level of 0.01, there is also a strong positive relationship between savings with Vision Fund Rwanda and Women Economic Empowerment r of 0.806, p- value of 0.000, and study showed that there is a high strong positive relationship between Trainings offered by VFR and Women Economic Empowerment with (r =0.948, p =0.000). It was also the most predictor of empowerment (𝛽=0.909).

Consequently, it is concluded that Microfinance institutions have a positive economic effect on selected Women in Rwanda.

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