Abstract:
Microcredit groups are beneficial in boosting socio-economic empowerment and
financial inclusion in underserved communities. However, the long-term viability of
microcredit groups depends on a balance of organizational, social, and financial
elements. The organizational durability of microcredit groups is attributed to their
ability to maintain stability, active member engagement, and loan repayments. At the
same time, clear rules reduce default risks and ensure steady group operations. This
research aims to explore the organizational sustainability of Sri Lankan rural
microcredit groups, focusing on leadership, group management, and training
programs to enhance their effectiveness. The research employs a qualitative
approach to examine the sustainability of microcredit groups, and interviews were
conducted with 16 microfinance groups in the Anuradhapura district. The interviews
focused on their experiences, and groups with fewer than three members or those that
are no longer operating were excluded. Thematic analysis was the analysis tool used
to identify organizational dimensions of sustainability. The research findings
highlight the importance of strong leadership, clear operational systems, teamwork,
participatory decision-making, and continuous training for the long-term
sustainability of microcredit groups. It also suggests that government support and
modern digital financial tools are crucial for future sustainability. The research
findings aim to enhance the long-term viability of microcredit groups by targeting the
development of leadership capabilities, improving governance systems, promoting
inclusive decision processes, and providing broader training opportunities.
