Influence of Credits Risk Management on Vicoba’s Loan Repayment Performance in Tanzania: The Case Study of Korogwe Town
DOI:
https://doi.org/10.59645/abr.v12i1%20&%202.10Keywords:
Credit risk management, Loan repayment performance, VICOBAAbstract
This paper investigates the influence of Credits Risk Management (CRM) on Village Community Banks (VICOBA)’s loan repayment performance at Korogwe town in Tanzania. The study has adopted the descriptive research design where240 clients and 66 leaders from 33 VICOBA were interviewed. Data analysis was done by using descriptive statistics. The study finds that the CRM techniques used by VICOBA were proper savings and deposits, proper loan size, use of collateral, guarantors, leaders’ strategies and social cohesion. The study also finds that CRM techniques influence78% of borrowers to repay their loans accordingly to loans’ contract. The study recommends that VICOBA clients should be trained more on CRM techniques and the importance of the timely loan repayment. The study further recommends that borrowers should use different CRM techniques in order to make sure that they repay their loans according to the loans’ agreement.
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