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Please use this identifier to cite or link to this item: http://bsuir.bsum.edu.ng:8080/jspui/handle/11409/411

Keywords: ANALYSIS
Issue Date: Jun-2014
Abstract: This thesis evaluated the Triangle of Microfinance in Benue State using sustainability, outreach and impact as parameters for measurement. Given the level of poverty in Benue State and the reluctance of conventional deposit money banks to the poor, this thesis examined the extent to which the microfinance banks (MFBs)operating in the State have contributed to poverty alleviation. The study used primary data obtained from the nine functional MFBs in the State to measure outreach, sustainability and impact that make up the microfinance triangle. The breadth of outreach was measured using a simple proportion that related total client base of all the MFBs to the total adult population of the State. The outreach result indicated that MFBs in Benue State extended their services to less than 2% of the adult population of the State. A measure of the poverty status of the MFB clients showed that about 17% and about 83% were considered poor and non poor respectively - an indication of mission drift. Using standard financial ratios such as Operational Self-Sufficiency (OSS), Write-off Ratio (WOR) and At-Risk Ratio (ARR, it was shown that all the MFBs under investigation operates on a sustainable basis since none had an OSS or WOR of less than 0.5. The Satterthwiate - Welch t-test was used to statistically estimate the level of difference if any between beneficiaries and non-beneficiaries of MFB loans. The results show that while there were statistically significant differences in house ownership status, children's school enrolment and ability to absorb shock, there were no significant differences in poverty levels and quality of food intake. Secondly, logit regression models were employed to measure the marginal effects of MFB loans on beneficiaries' poverty status. Some challenges facing the MFBs in the State were identified such as poor quality staff, low level of. financial literacy, inadequate infrastructure, among others. Based on its findings, the thesis made a number of recommendations which included the need for the Central Bank qf Nigeria (CB1V)• to raise the minimum capital base requirement for MFBs, the need Ibr the MFBs to engage more quality staff, the need for government to extend social infrastructure to the rural areas so as to encourage MFBs to locate in such areas and the need for MFBs to more closely monitor their clients on loan use
URI: http://bsuir.bsum.edu.ng:8080/jspui/handle/11409/411
Appears in Collections:Economics

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