An economic analysis on impact of microcredit at Nintavur divisional secretariat area, Sri Lanka: special reference to women entrepreneurs

Abstract

South Asia has the largest number of people in the world living in absolute poverty, which includes 43 percent of the developing world‘s population. 60 percent of these are women, with limited access to basic needs. The greatest burden of human deprivation and poverty, illiteracy and health – related problems fall on its women (UNIFEM 1999). Microcredit seeks to promote business growth and improve well – being by expanding access to credit. According to the above background, the objective of this study is to examine the impact of microcredit on women entrepreneurs‘ socioeconomic status in Nintavur. This study is based on primary and secondary data. Through the simple regression model, 100 women entrepreneurs were selected and primary data were collected using structured questionnaires, key informant interviews and focus group discussion as well. The states purpose is analyzed by using quantitative and descriptive analysis. The results indicate that the microcredit factors positively and moderately affect the women entrepreneurs‘ socio-economic status. Microcredit activities have affected the lives of clients (and others) in multiple ways. The most frequently reported types of effects of credit at individual, enterprise and household level are the following; income, expenditure smoothing, poverty alleviation, business growth, saving, schooling effects, skills, mobility and effects in terms of women empowerment. In terms of development and social impact, micro credit allows significant improvement in standard of living on women entrepreneurs and their families in Nintavur. It is also observed that microcredit system promotes entrepreneurship among women in Nintavur Divisional Secretary area.