Borrower’s aptitude and attitude towards microfinance loan payment

Saing, Roberto Jr C. and Pacarat, Reje Ann B. and Pingot, Leneth Pearl S. (2025) Borrower’s aptitude and attitude towards microfinance loan payment. International Journal of Science and Research Archive, 14 (2). pp. 1010-1017. ISSN 2582-8185

Microfinance institutions are vital financial services providers to underserved communities through economic empowerment and poverty relief. Nevertheless, the sustainability of these institutions depends on the ability and behavior of borrowers to repay them. One hundred seventy-six (176) respondents who availed of loans in microfinance institutions in Boston, Davao Oriental, Philippines, were surveyed for this research. The main findings suggested that borrowers who are married (85.2%), have few dependents peak earning, are between 31 and 40 years old (39.8%), achieved high educational levels (secondary 48.3%, tertiary 5.1%), save constantly (75%), and own business assets (51.1%) may have better potential for repaying loans. In contrast, those who earn little (<10k/month) at 70.5% might be unable to repay their debts when they become due. Moreover, the respondents had an exceptionally positive attitude toward payment, including timeliness, with a mean score of 4.26, credit investigation score of 4.03, ease of payment score of 3.95, and willingness to pay scores of 3.87. Furthermore, the significance of borrowers' aptitudes and attitudes based on their demographic profiles: educational level, type of savings, and level of income (for timeliness) significantly influenced borrowers' attitudes, while factors like marital status, number of dependents, level of income (at ease of payment, willingness and credit investigation), age, and type of assets did not have a significant impact.