Assessing the Capacity and Financial Status of Microfinance Institutions in the Province of Nueva Ecija: Interposing the Role of Service Satisfaction

Abstract

This study assesses the capacity and financial status of microfinance institutions (MFIs) operating in the province of Nueva Ecija, Philippines. The Philippines is one of exiguous countries with a national microfinance policy. The Microfinance NGOs Act, also known as Republic Act No. 10693, defines microfinance as the feasible and sustainable provision of a wide variety of financial services to poor and low-income persons engaged in livelihood and microenterprise activities. This study argued that to continue providing satisfactory service to the poor, MFIs must be viable and sustainable. The objective of this study is to examine the borrowers’ degree of service satisfaction to microfinance institution including their business and financial status. The descriptive correlational research technique was utilized to acquire the essential data for the study. Survey questionnaire and un-restructured interview was also employed to collect and triangulate data. According to the findings of the study, microfinance institutions operating in the province of Nueva Eija provided an excellent service to their borrowers, as demonstrated by a very satisfied rating of its clients for loan application processing and loan basic component of services and borrowers perceived that Microfinance Institutions (MFIs) played an important role in fostering financial inclusion in local communities, particularly among low-income households as evidenced by very high and high business and financial status.