ANALYSIS OF THE SOCIO-ECONOMIC EFFECT OF MICROCREDIT ON MICRO-ENTREPRENEURS USING THE SELF-REPORTED PERCEPTION METHOD AND RELATIONSHIPS WITH OTHERS

Microcredit offers an innovative response to non-traditional financing and development needs for marginalized individuals. Here, impact assessment is very useful in that it helps to determine whether or not the objectives set at the onset are achieved and what can be done to correct the impediments to achieve better results. The paper analyzes the socio-economic effect of microcredit through the novel dual approach of self-reported perception and relationships with others. The data were gathered in collaboration with the Fonds Mauricie in November, 2019. Apart from the improvement in the financial indicators of micro-enterprises, the results show that microcredit has enhanced micro-entrepreneurs’ living conditions and family situation at rates of 88 and 91 percent, respectively. Regarding morale, 88 percent of micro-entrepreneurs report feeling better and optimistic about the future, and 92 percent report better relationships with others. In particular, the socio-economic effect of microcredit is determined by a better family situation, better living conditions and better financial situation and business income. These results imply that microfinance institutions must extend their financing to all segments of the population, especially the most vulnerable people such as immigrants and indigenous peoples.