Abstract:
The aim of this study was to investigate the practices, Challenges and opportunities in
delivering credit after transformation of Micro Finance Institutions into commercial bank,
Case of Sinqee Bank Share Company. The study was conducted using a descriptive survey
research design to attain this study. The study employed qualitative research methodologies
to gather and evaluate both primary and secondary data sources. For the study, one hundred
twenty two employees were chosen from among 573 employees at head quarter of Sinqee
Bank Share Company, the sample included managerial and none managerial employees.
The primary data was obtained using predesigned questionnaires from Micro Finance
Institutions management, supervision, while the secondary data was obtained through
documentary reviews. The sample approaches were simple random sampling. The data from
the questionnaire was encoded; stored and analyzed using descriptive analysis technique,
standard deviation, descriptive mean, distribution tables and percentiles.
The study findings indicated that, major factors that impacted the process of transformation
of Micro Finance Institutions are cost of loan processing, Cost of staff training, Quality and
integrity of collateral asset estimation team, preparedness of loan officers and managers in
processing Micro Finance Institution & none Micro Finance Institution loan products and
human resource. Micro Finance Institutions seeking to transform to banking business
license should therefore prepare business plan and feasibility study, prepare detailed and
prudent strategy, meeting minimum cost training, standard quality and integrity of collateral
asset estimating team, work on preparedness of loan officers and managers in processing
Micro Finance Institution and none Micro Finance Institution loan products, dedicating
sufficient IT infrastructure and MIS software application, human and financial resources to
the transformation process.
The company needs to utilize the support from the government in the way it creates more
opportunity with regard to saving mobilization, facility upgrading and also has to enhance
its accessibility to farmers with more service quality that could be the competitive advantage
in the future.
