| Abstract: | The objective of this study was to assess the practice & challenges of saving
mobilization of Micro Finance Institutions in the case of Specialized Financial &
promotional institution (SFPI). The lending activity of the micro finance institution is
made possible by\mobilizing enough funds from their customers. The target
population for the study include branch managers, operation supervisors and
saving& credit officers those having two years and above experience & potential
saving clients involved in deposit mobilization. Data collected through primary data
such as questionnaire and secondary data from the annual reports of SFPI. The
sampling method in the branches staff for the study used census method & the
sampling size was 125 from all operational staffs while a multi staged stratified
random sampling technique used to select a total of 160 active saving clients.
Descriptive method was adopted for the study to analyze the data. The researcher
used structured questionnaire for employees and customers of SFPI and reviewed
five year annual report. The findings have shown that, SFPI has not conducted
regular promotion, poor branch expansion trend, poor incentive system to staff and
customers, provided of poor training to staff. Challenges that face microfinance
institutions are Poor saving habits or cultures in the society, inflation & political
instability & unstable economic conditions, unavailability of appropriate
organizational structure, competition, Lack of management information system and
loan default. The study, therefore, the researcher recommend that the management of
the SFPI has to consider expanding of branches, conducting of regular promotion,
to apply management information system, capacity building for frontline staff, and
develop incentive system to staff & potential client to make more saving mobilization. |
