Rural Poverty in Nigeria. The Role of Microfinancing

Abstract

The study investigates the impact of micorfinancing in alleviation of poverty among rural dwellers. Employing both descriptive and inferential statistical analysis on retrieved data from rural sample, we found that at most 50 percent of our sampled respondent, live relative poverty; absent access to drinkable water, good drainage and waste disposal system, and feed twice a day on a diet dominated by carbohydrate. Investigating for impact, our multiple OLS regression analysis, shows that credit obtained from corporative societies are more significant in the alleviation of poverty than those gotten from microfinance banks, as their effect on poverty was found to have an insignificant effect in the improvement of the welfare/ alleviation of poverty. Which we adduce to the high interest rate charges which the respondent customers report to be on the high side. It was discovered that government provision of infrastructure and sound education are vibrant tools for the alleviation of rural poverty, as both were found to have significant positive effects on welfare. The same was noted for improvement in age. However, that increase in family size (number of children) and prolonged years in a particular occupation (absent innovation and expansion, leading to motononicity) will aggravate the level of poverty. The study therefore recommends, the need to encourage corporative societies; organize workshops for training and innovation, encourage improvement of educational learning and family planning.