Role of microfinance saving in Cameroon: a neo-structuralist analysis
Purpose – The aim of this paper is to establish an original database from fieldwork on microfinance institutions in Cameroon. Design/methodology/approach – The main method used for the research involved statistical analysis of an original survey data. The latter fieldwork analysis has enabled us to test the hypothesis of neoclassical and neo-structuralist economists advocating a significant relationship between microfinance savings and liberalised real bank deposit interest rates. Findings – The statistical analysis carried out indicated that microfinance savings are associated to variables other than the rate of interest. The failure of a liberalised interest rate policy to cause a significant portfolio shift from microfinance into the banking system does not support the interest responsiveness of savings as advocated by the McKinnon-Shaw school. This paper supports, therefore, the neo-structuralist analysis of financial development where microfinance institutions are an important structural feature of financial systems in many developing countries. Research limitations/implications – It would be interesting to extend statistical analysis undertaken in this paper to other African countries. Practical implications – The main policy issue affecting microfinance from the empirical analysis is the need to mitigate the extremely high interest rates utilised by microfinance. Banks may be encouraged to undertake a series of measures such as guaranteeing of future loans to their customer by linking savings and loans to attract microfinance members. Originality/value – The contribution of this paper, therefore, is to provide a unique opportunity to investigate the association between microfinance institution assets and real interest rates in an African country.
Volume (Year): 8 (2009)
Issue (Month): 1 (June)
|Contact details of provider:|| Web page: http://www.emeraldinsight.com|
|Order Information:|| Postal: Emerald Group Publishing, Howard House, Wagon Lane, Bingley, BD16 1WA, UK|
Web: http://www.emeraldinsight.com/ijdi.htm Email:
When requesting a correction, please mention this item's handle: RePEc:eme:ijdipp:v:8:y:2009:i:1:p:48-60. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Virginia Chapman)
If references are entirely missing, you can add them using this form.