Impact Study of the Zakoura Microcredit Program
Zakoura Micro-Credit (ZMC) is the microfinance arm of the Zakoura Foundation, a national NGO commited to providing credit and training to a target market of economically disadvantaged women using a solidarity group methodology.
From ZMC's point of view, the study had four main objectives:
- To gain a better understanding of clients' product requirements;
- To assess client satisfaction;
- To evaluate the impact of the program on clients' lives and businesses;
- To understand the reasons clients leave the programme
The study analyses ZMC's impact at three levels: clients' enterprises; clients households, and clients as individuals. The main findings of the study include the following:
- 62.7% of the clients recorded an increase in income over the preceding twelve months;
- Clients were more actively involved in managing the household budget, potentially because of their increasing and more substantial financial contribution;
- Clients seem to be better protected against shortages of inputs as compared to non-clients;
- The ZMC programme encouraged entrepreneurship among its participants and made it easier for them to take advantage of possible business opportunities;
- In most fields of activity, clients' sales and profits were higher than those in the case of non-clients;
- ZMC program also promoted diversification in enterprise activities, either through funding or by empowering the women participants.
The report states by loosening the financial constraints that held women entrepreneurs back from taking decisions the Zakoura programme seemed to be fulfilling its role. The access to the credit market that the programme offers provides the participants with surplus resources that can be used for strengthening and expanding their enterprise activities. On the basis of comments made during client surveys, the main recommendations made by this report include:
- For new clients (1st loan cycle), the grace period should not be extended, since it is very important that the contact be maintained in order to ensure continuity, proximity and presence for these clients;
- For longer-term clients in the programme it would be more justified to increase the grace period to 3 to 4 weeks from the present 15 days;
- ZMC should strengthen its detailed client information and targeting system;
- To improve the retention rate ZMC needs to develop better client targeting strategies and ensure that their business activity profiles are copliant with ZMC procedures.
