Microfinance Banks: A De Facto Agent To Sustainable Economic Development In Nigeria

International Journal of Economics and Management Studies

© 2020 by SSRG - IJEMS Journal

Volume 7 Issue 10

Year of Publication : 2020

Authors : Dr. MOKUOLU Joseph Oluseye, Dr. KOLAPO Funsho Tajudeen, Dr. ADEJAYAN Adeola Oluwakemi, Dr. DADA Samuel Obafemi

10.14445/23939125/IJEMS-V7I10P111

How to Cite?

Dr. MOKUOLU Joseph Oluseye, Dr. KOLAPO Funsho Tajudeen, Dr. ADEJAYAN Adeola Oluwakemi, Dr. DADA Samuel Obafemi, "Microfinance Banks: A De Facto Agent To Sustainable Economic Development In Nigeria," SSRG International Journal of Economics and Management Studies, vol. 7,  no. 10, pp. 59-63, 2020. Crossref, https://doi.org/10.14445/23939125/IJEMS-V7I10P111

Abstract:

This paper examines the impact of microfinance institutions as a de facto agent in sustaining the Nigerian economy. The study adopted secondary data sourced from several issues of the Central Bank of Nigeria (CBN) Statistical bulletins and National Bureau of Statistics and applying ordinary least square of multiple regressions over time series annual data of Nigeria from 1994 through 2015, a period covering about twenty-one years to empirically test the sustainability of microfinance institutions in developing the economy of Nigeria. The study confirms from the correlation coefficient of the results that there is a positive relationship between Deposits and Loans and Advances depicting the microfinance activities and the economic growth and development of Nigeria represented by the Gross Domestic Product (GDP). The regression analysis results showed that the effect of Deposits on economic growth and development is significantly positive. In contrast, the effect of Loans and Advances is insignificant but positive on the GDP. However, the F-statistics result showing the overall significance of the model implies that MFIs will go a long way in impacting economic growth and development in Nigeria through poverty alleviation of the low and middle class of society the majority of the populace. Therefore, it is recommended that the government create an enabling environment capable of supporting the microfinance banks in microcredit delivery to sustain the economy.

Keywords:

Sustainable, Micro Finance Institution, Deposits, Micro credits

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