The Impact of Customer Service on Loan Performance in the Microfinance Sector

The main objective of the study was to analyse the impact of customer service on loan performance in the microfinance sector using selected Microfinance Institutions in Takoradi as case study. This research sought to address the following objectives:

1. To identify the customer service practices in these Microfinance Institutions.
2. To examine the key challenges in the implementation of customer service practices.
3. To determine the relationship between customer service and loan performance.

The study adopted a descriptive study approach. Descriptive survey aims predominantly at observing, describing and documenting aspects of a situation as it naturally occurs rather than explaining them. The design provides a more accurate picture of events at a point in time. The study was purely quantitative in nature. The population of the study comprised all the employees of the selected microfinances namely, Coastal Commerce microfinance, First Rate microfinance, Loan line microfinance, Yalex microfinance and Cashpoint microfinance. For this study, fifty (50) employees were sampled out from the entire population. A simple random sampling technique was employed to select the 50 employees out of all the employees. A questionnaire was chosen as the data collection instrument. The Statistical Package for the Social Science (SPSS) was used for data coding, entry and analysis.