ABSTRACT

The study covers the "role of credit risk management on the performance of microfinance institutions", in Uganda a case study of PRIDE MICRO FINANCE The scope of the research included, the funding of MFI, the role of MFI, the challenges lending policies, how credit risk measurements, the credit of risk management and hoe the credit risks affect the resources of MFI in terms of planning, controlling, directing and organizing. Objectives included establishing the various methods which PRIDE microfinance uses to extend credit to it's customers, finding out the presence of credit risk in Pride Microfinance, establishing the extent of credit risk in Pride microfinance, to identify factors influencing credit risk in PRIDE microfinance limited and to establish how best credit risk can be managed in Pride Microfinance. Data was collected using primary data and secondary data. Primary data by use of questionnaires and interviews While secondary data by reading and analyzing Published data, it was processed by using different analyses. The findings were that credit risk is reduced in Pride Uganda microfinance due to the measurements put in place. The recommendation of the research findings will help institutions currently operating in Uganda to improve on their methods of delivery, and performance, and those that are trying to expand to avoid costly mistakes. The researcher fills has not exhausted all findings on the topic and therefore recommends upcoming other researchers to carry out research on the Management of resources and the procedures taken by the management in case a client fails to pay back the loan.