Conference Paper
Why Do They Walk Away: Understanding Microcredit Client Dropout in Egypt’s Microfinance Sector from the Loan Officer’s Perspective
No.
ERF32AC_107
Publisher
ERF
Date
May, 2026
Topic
G. Financial Economics
Microfinance has been operating in Egypt since the early 1980s. This paper investigates the slight but significant decline in client numbers since the start of 2025. It adopts a mixed-methods approach combining both quantitative and qualitative analysis. Specifically, it utilises a quantitative survey administered to staff and loan officers, along with a semi-structured interview schedule conducted with experts in microfinance, poverty reduction, and economic empowerment. The theoretical framework primarily relies on three theories: Relational Lending Theory, Principal–Agent Theory, and Street-Level Bureaucracy. The main finding indicates that this dropout is likely to increase for several reasons, including factors related to the economic context and the legal framework of microfinance in Egypt. Other contributing factors include governance, client-loan officer relations, policy requirements, and legal awareness among both loan officers and clients, as well as inadequate training for loan officers and clients.
Authors
Shymaa Bedaiwy Allam
PhD Candidate in Global Inclusion and Social...
Authors
Ingy Abdel Hamid
Associate Professor of Political Science, National Centre...