The Role of Microfinance Banks Credit on Poverty Alleviation in Nigeria (2007-2023)

This study examined the role of microfinance banks credit on poverty alleviation in Nigeria from 2007 to 2023. The specific objectives were to evaluate the effect of microfinance banks credit on key indicators of poverty, including the Human Development Index (HDI), Poverty Rate (POVR), and Unemployment Rate (UMPR). The study was based on an econometric model to establish the relationship between Microfinance bank credit and poverty alleviation. The hypotheses were stated in both null and alternative forms. The study used secondary data obtained from the Central Bank of Nigeria (CBN) statistical Bulletin. Ordinary Least Squares (OLS) regression analysis was applied to test the interaction between the independent variable (Microfinance bank credit) and the dependent variables (Human Development Index(HDI), Poverty Rate(POVR), and Unemployment Rate (UMPR). The findings reveal that Microfinance banks credit has a positive and significant effect on improving the Human Development Index and reducing poverty and unemployment rates in Nigeria. The results provide key insights for policymakers and stakeholders in the financial sector on how Microfinance can contribute to poverty alleviation. The study recommended that the federal government should increase support for microfinance banks to expand credit access, particularly in rural areas, to further enhance their contribution to poverty alleviation and sustainable development.