Pressure on Loan Officers in Microfinance Institutions: An Ethical Perspective

Abstract

Loan officers play diverse and significant role in microfinance institutions. But they encounter tremendous pressure while performing their job. Some of pressures are like meeting deadlines and quotas, powerful hierarchical pressure, reducing Portfolio at Risk, working more than normal functioning hours outside office, structural pressure etc. These types of pressure reduce productivity, creates dissatisfaction with job, lower confidence, hamper relationship, and most importantly attack personal life. This unrealistic pressure on loan officers is an ethical issue. In this paper, some management consequences are shown as a result of unethical pressure like reducing staff productivity, high turn-over, hindering portfolio quality, employer-employee relationship, image of the organization etc. Besides that some practical recommendation for the managers of microfinance institutions are suggested like proper implementation of Human Resource Policy and Procedures, appropriate planning and supportive culture, effective communication and feedback, adequate staff training and mentoring, following bottom-up approach, strengthening effective communication, logistic support etc. Keywords: Loan Officers, Pressure, Microfinance, Ethics