Samenvatting

Microfinance programs have significant potential for contributing towards improvements of agricultural and other rural sectors investments and operations and empowerments of rural community. However, access to financial institutions such as banks by smallholder farmers in rural areas is limited because of the nature of these institutions (location and conditions of service). Many of them regard lending to agricultural related income generating activities as being too risky and unprofitable. As a result farmers in Tanzania have to resort to alternative sources of credit such as Savings and Credit Cooperative Societies (SACCOS). SACCOS improve poor smallholder farmers’ access to credit by providing affordable banking services that help to finance income-generating activities and reduce poverty in rural areas. Towards this direction several rural finance projects have been established in Tanzania to assist smallholder farmers. Some of these projects have been implemented in partnership between development actors. According to project evaluation document there was discrepancy between the planned role of each partner and the actual implementation. Evaluation done focused only on the project that is why the need arise to study the relationship between partners in the project. It is on basis of this discrepancy that researcher explored the constrains faced by different partners during implementation of the project. The main research questions were two, one what are the constraints faced by partners during implementation of development of income generating activities project in Tanzania? The second main question was what induced partners to work together in development of income generating activities project in Tanzania. The empirical evidence of the study indicates that long historical relationship was the key for success of the partnership. It also shows that this partnership offered both challenges and opportunities. Challenges in reaching the interest of each partner as well as managing the partnership. Some of the challenges are lack of trust between partners, lack of clearly stated exit strategy, conflict of interest between partners and use of different approaches by partners. On the other hand partners derived some benefits by working together some being increased partners outreach, increase partners trust outside environment, bring resources that can not be obtained easily by one organization and working in partnership has helped partners to reach more farmers. It was also noted that fund was the main reason that derived partners to work together. It was pre-condition to get fund from donor. For future intervention of similar nature it is recommended that partner should first seek understanding each other first before formalizing any partnership. Also partners should ensure that there is maximum participation of all partners at every stage of the project. It is important also to build the capacity of partners in the area of partnership at the beginning of the partnership. This will add support to ensure that all partners own and understand the partnership at the beginning. Exit strategies should be clearly stated and shared between partners. When partners realize that they have approaches that differ a lot it is necessary to either stop partnership or agree on the common approach that will be used.