Abstract

The study was intended to analyze the determinants of group loan repayment performance of MSE’s sectors a case of   Oromia Credit and Saving Share Company operating in the East Wollega Zone. The survey data was conducted by using the structured questionnaire in order to collect primary data from the purposively selected branches whereas secondary data were collected from published and unpublished documents. Out of 424 total number of groups owned of MSE’s sectors 168 sample size were selected and only 162 of the respondents have filled the questionnaire properly by their respective enterprise’s group leaders. The collected data were analyzed by employing descriptive statistics and ordered logit model by using STATA soft ware version 12. Result of this study shows that out of the predicting variables used in this study, group leaders education level, group leaders experience in similar business, the enterprise’s beginning capital, loan repayment period,  loan follow up, Training offered by the loan officers of OCSSCO and  access to output market for the enterprises finished products were found to positively influence while the enterprises group size, additional loan they received, problem of information disclosure among members, the problem of financial statement recording experience in the business, loan interest rate, problem of power interruption and shortage of water supply around the enterprise working area  have negatively influenced the group loan repayment performance of MSE‘s sectors in the study area. Based on this result, the author recommended that OCSSCO has to  focus on the smaller the group size through which the problem of information disclosure would be resolved ,they has to give frequent training about the financial statement recording experience, they have to deal with the concerned body to solve the problem of power interruption as well as about the shortage of water supply around the enterprise’s business area and encouraging them to increase their beginning capital at the enterprise start up that used to build confidence in their loan repayment performance in the study area.