Lifting the poor in Nigeria: a comparative analyses of the role of microfinance banks and cooperatives

Abstract

Objectives: This study investigates the role of microfinance banks (MFBs) and cooperatives in lifting the poor in Nigeria. Methods/Statistical analysis: Analyses are carried out in relation to how accessible and effective the two institutions’ loans. The study employs survey methodology where interview is used to generate data. The interview is conducted in Ibadan, the capital of Oyo state, and Abeokuta, the capital of Ogun State in South-western part of Nigeria. In all, 166 respondents provided the information used for this study. Simple averages and percentages are used for analysis. Findings: Findings reveal that it is difficult for the poor to access MFBs’ loans, and loan effectiveness analyses show that only middle income and rich people can benefit from MFBs’ loans.However,cooperatives’ loans are found to bemore accessible and effective to the poor. Improvements/Applications: The results of this study have important implication for poverty reduction, thereby recommends that cooperatives movement should be encouraged inNigeria.