Author(s)

Shuaib Jalal-Eddeen^1*, Muawiya Saleh², Fadimatu Jalal-Eddeen³

¹School of Business & Entrepreneurship, American University of Nigeria, Yola, Nigeria.
²School of Arts & Science, American University of Nigeria, Yola, Nigeria.
³College of Continuing Education, Adamawa State Polytechnic, Jimeta-Yola, Nigeria.

Background: In their quest to address poverty and uneven income and wealth distribution often attributed to low economic growth performance and low labour returns amongst others, the governments of the developing countries through their respective central banks came up with the micro-finance policies. In Nigeria, the central bank came up with a policy in 2004, which aims to give micro, small and medium enterprises access to informal financial services to boost their capacity towards economic growth and development. While this policy has reduced the level of poverty among the low-income populace, the operations of the microfinance institutions are receiving increasing threats from the beneficiaries, especially loan default, which is often as a result to multiple borrowing. Methods: A cross-sectional study using a mixed method approach was adopted for the study. The questionnaires were distributed to eligible persons and the responses an-alysed using SPSS version 24 and a simple Microsoft Excel. The respondents were clients from three randomly selected microfinance institutions in Yola, Adamawa State, Nigeria. Results: The outcome of this study has shown that while about 66% multiple borrowing incidences from various microfinance institutions were very high, 91.43% and 77.14% of the respondents believed that multiple borrowing and loan default, respectively, could be prevented through the use of a common database. Conclusion: It is recommended that microfinance banks and institutions should invest in implementing a common database for managing client requirements and minimizing concurrent borrowing and loan defaults.

Common Client Database, Multiple Borrowing, Microfinance Institutions, Loan Default, Targeted Sensitization, Adamawa State, Nigeria

Jalal-Eddeen, S. , Saleh, M. and Jalal-Eddeen, F. (2019) A Common Database for Clients and Its Effect on Loan Default in Microfinance Bank Operations: An Outlook of Microfinance Banks in Yola, Adamawa State, Nigeria. Open Access Library Journal, 6, 1-12. doi: 10.4236/oalib.1105913.