The impact of providing business training to microfinance clients: empirical evidence from Tanzania

Abstract

This master thesis studies the impact of providing business training to microfinance clients in Tanzania. Based on data collected six months after the programme ended, we cannot confirm positive treatment effects from business training on the micro entrepreneurs’ profits. However, treated entrepreneurs have higher likelihood of operating multiple businesses; increased their engagement within commerce and reduced their engagement within manufacturing. Based on the market situation at the time, these changes all represent advancement towards business structures associated with higher profitability. Moreover, findings of low profitability in new establishments can serve as an explanation to the small effect from business training on profits, and imply that treatment effects will be manifested in higher future profits of the entrepreneurs.