The impacts of credit provision of micro finance institutions on job creation and poverty reduction: Acase study of Smfi, Hawassa City, Ethiopa

The objective of this study is to assess the impact of credit provision of microfinance institution on job creation and income generation in Hawassa city. In order to carry out this study the field survey was conducted on a sample size of 133 members randomly from 35 small scale enterprises of the package program. The credit provision was assessed using various indicators of economic and social aspects such as income, access to education service, and health care, nutrition condition and self- employment. The research work employed both primary and secondary data like questionnaires, interviews, focus- group discussions and on- site- observation to collect primary data. The secondary data has been collected from different review of literatures, unpublished and published materials. The questions to be addressed in this study required both quantitative and qualitative research methodologies. This study discloses microfinance institution credit provision increase in: income and diversified sources, and reduce income inequalities. It has also contributed to increase personal consumption and improved living condition in terms of assets, access to education and medical services, and creation of employment opportunities. The findings of the study indicate that the beneficiaries of credit in the area perceived their lives have improved after the intervention of the credit. The outcome of the study has established that microfinance intervention on Job creation and Poverty reduction has achieved significant improvements. Therefore, it is recommended that such a strategy and micro finance institutions should be encouraged and diversity their activities and approaches to include the active poor.