The Impact of Microcredit on Livelihood Improvement of Women in Muhanga District, Rwanda

Abstract

This study aimed to examine the contribution of Microfinance to improving the livelihoods of women in rural Rwanda. The study area was Muhanga District, where this research seeks to address through the lens of microfinance. An explanatory design was employed to assess the extent to which women's livelihoods changed as a result of microcredit. A deductive approach was adopted to compare arguments from previous studies, collect data, analyse results, and interpret findings. Data were collected from a sample size of 309 respondents systematically selected from a population of 1,349 women beneficiaries of a local microfinance institution. Structured questionnaires were used to gather data, which were entered into SPSS version 20 and analysed using descriptive statistics and bivariate Correlation techniques. The findings reveal a strong positive correlation between access to microloans and improvements in key livelihood dimensions, although not all areas experienced uniform growth. Importantly, participants reported increased financial stability and greater access to essential services. The study concludes that microcredit significantly enhances women's livelihoods and supports poverty reduction efforts. The study recommends that lending institutions, policymakers, and nations strengthen access to credit by providing favourable loan conditions and coordinating with governmental and non-governmental stakeholders to enhance long-term impact.