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The Impact of Microfinance on Rural Economic Growth: The Nigerian Experience

Author

Listed:
  • E. Chuke Nwude

    (Department of Banking and Finance, Faculty of Business Administration, University of Nigeria, Enugu Campus, Enugu State, Nigeria,)

  • Kenneth Chikezie Anyalechi

    (Department of Banking and Finance, Faculty of Business Administration, University of Nigeria, Nsukka, Enugu Campus, Enugu State, Nigeria.)

Abstract

The paper examines the impact of microfinance activities on rural economic growth and savings in Nigeria for the period 2000 2015. The ordinary least square regression was used as the technique of analysis. The findings show that the introduction of micro finance banking in Nigeria have not contributed to agricultural productivity but had assisted in increasing rural savings habits in Nigeria. As a means of improving rural economic growth in Nigeria the recommendations are that government should make conscious efforts to provide basic infrastructures in the rural areas to motivate micro finance institutions to locate their offices there; micro finance institutions should be encouraged to lend to rural dwellers based on relationship lending; some farm productive resources should be diversified to reduce farming risk, especially risk related to unpredictable extreme weather that may be due to climate change to increase productivity.

Suggested Citation

  • E. Chuke Nwude & Kenneth Chikezie Anyalechi, 2018. "The Impact of Microfinance on Rural Economic Growth: The Nigerian Experience," International Journal of Economics and Financial Issues, Econjournals, vol. 8(4), pages 27-31.
    • Handle: RePEc:eco:journ1:2018-04-4
    as

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    References listed on IDEAS

    as
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    5. Hossain, Mahabub, 1988. "Credit for alleviation of rural poverty: the Grameen Bank in Bangladesh," Research reports 65, International Food Policy Research Institute (IFPRI).
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    Cited by:

    1. Omorose A. Ogiemudia & Igbinovia Lawson Eghosa & Amenze S. Airhiavbere, 2022. "MICROFINANCE BANKS OPERATIONS AND ECONOMIC DEVELOPMENT IN NIGERIA The paper explored the influence of Microfinance Banks (MBs) on Economic Development (ED) in Nigeria. It was embarked upon against the," Oradea Journal of Business and Economics, University of Oradea, Faculty of Economics, vol. 7(2), pages 75-86, Septembri.

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    More about this item

    Keywords

    microfinance; economic growth; gross domestic product; rural savings; Nigeria.;
    All these keywords.

    JEL classification:

    • A10 - General Economics and Teaching - - General Economics - - - General
    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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