The Impact of Microfinance in Alleviating Poverty in Nigeria: A Study of Five Selected Microfinance Banks in Shomolu LGA, Lagos State

Abstract

This study examines the role of microfinance vis-à-vis poverty reduction in Nigeria. Data were collected through survey questionnaire in the study area. This study considered descriptive survey research design and a sample size of 168. Descriptive statistics together with Binary Logit Regression Model were employed to analyse the data collected Microfinance has been identified as one of the influential development efforts towards promoting financial sustainability for poor individuals in the society. The government of Nigeria has made concerted efforts to alleviate poverty in the country. One of such efforts is Poverty alleviation. The result of the analyses revealed that most of the Microfinance Institutions in Nigeria are rather too young to have made a very remarkable long term impact. Most of the micro-entrepreneur-customers are in their prime age of life which falls in the economic activity group. Furthermore, about 73% of the customers are women, which validate the general belief that we have more women engaged in Microfinance activities in Nigeria than men. It is therefore, recommended that microfinance should not be seen as a universal remedy for poverty and related development challenges, but rather as an important tool in the mission of poverty alleviation. Poverty is a multidimensional problem, embedded in a complex and interconnected political, economic, cultural, and ecological system