American Journal of Economics, Finance and Management
Articles Information
American Journal of Economics, Finance and Management, Vol.4, No.2, Jun. 2018, Pub. Date: Jun. 6, 2018
Impact of Microfinance Banks Policy on Rural Development in Kwara State
Pages: 44-56 Views: 646 Downloads: 1069
Authors
[01] Yahaya Abdulrazaq Akanni, Agricultural and Rural Management Training Institute (ARMTI), Agricultural Development Management (ADEM), Ilorin, Nigeria.
[02] Oni Olusegun Opeyemi, Agricultural and Rural Management Training Institute (ARMTI), Agricultural Development Management (ADEM), Ilorin, Nigeria.
[03] Ishola Sarah Oluwakemi, Agricultural and Rural Management Training Institute (ARMTI), Agricultural Development Management (ADEM), Ilorin, Nigeria.
[04] Gbadamosi Fausiyat Yinka, Agricultural and Rural Management Training Institute (ARMTI), Agricultural Development Management (ADEM), Ilorin, Nigeria.
[05] Odeseye Abdulhameed Adewale, Agricultural and Rural Management Training Institute (ARMTI), Rural Development and Gender Issues (RUDEG), Ilorin, Nigeria.
Abstract
The importance of microfinance banks (MFBs) in providing diversified, affordable and dependable financial services to the un-served, but economically active clients in the rural areas cannot be overemphasized. In view of this, the government of Nigeria saw the need for the establishment of the 2005 microfinance bank policy, created to serve the informal sector. However, not more than five years after the establishment of the policy, records show that there was already great distress in the system as microfinance banks had failed to achieve their set obligations. Hence, this study examined the contribution of microfinance banks policy to rural development in Kwara State, Nigeria. Specifically, the study examined the effect of micro-finance bank policy objectives on the existence of MFBs in rural communities of Kwara State as well as examined the divergence views between MFBs’ officials and their customers in respect of the achievement of MFBs policy objectives in the rural communities of Kwara State. The study employed primary data obtained through questionnaire. Descriptive statistics, multiple regression analysis and t-test were used to achieve the objectives of the study. Results of the regression analysis revealed that there is positive relationship between the adoption of microfinance banks and its policy objectives of savings culture, provision of investment loans, and employment opportunities in rural areas of Kwara state at 5 percent significant level except the provisioning of advisory and linkage service which were not significant. The results were also confirmed through the t-test analysis conducted. The study concluded that microfinance banks policy has contributed to rural development in Kwara State, Nigeria. The study therefore, recommends among others that the regulatory agencies should as a matter of urgency license, regulate, monitor and evaluate the performance of microfinance banks so as to help solve the problems of unemployment.
Keywords
Micro Finance, Rural Development, Central Bank, Microfinance Policy
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