Abstract
Poverty is one of the socioeconomic challenges bed evilling many families, particularly the northern states of Nigeria. This study applied qualitative research paradigm and generated the perceptions of informants via convinience sampling. We analyzed the data through thematic, narrative and interactional apparoach. Our objective is to explore microfinance institutions strategic policies for poverty reduction and recommend to policy makers. The results exposed that micro financial institutions were classified into formal, informal, development and those with mortgage outlook.The Central Bank of Nigeria issue the certificate for authorization, the licensing and ownership. The Paid-up capital requirements, the permissible and acceptance of deposits, savings from individuals, groups and associations were the policies which propel these institutions. The non-permissible policies are restrictions on acceptance of public sector deposits. The study identified inadequate supervsions and loans defaults, poor infrasturectural facilities in rural areas, pitiable communication and derisory banking experience among the poor and low income earners, limited standardization and operating system as well hampered their services in the quest to mitigate poverty in the study area.The re-capitalization, efffective regulatory control via financial control, regularly supervision, checks and balances. Capacity building programs and Proper staffing.Provision of appropriate business model; strategies and creation of awareness. The provision of door to door banking marketing awareness, establishment of financial literacy; consumer protection programs and Provision of non-interest banking programs were perceived to overcome the perils of these institutions respectively. The study recommended for establishment of Islamic financial institutions and Takaful insurance scheme.
Highlights
The expansion of micro financial institutions started earlier in the form of informal cooperatives societies, micro credit and savings by various communities in Nigeria (Taiwo, Alege & Olokoyo, 2016)
Data Analysis and Results The results were articulated according to types of microfinance in Nigeria, policies, challenges and strategies to improve microfinance institutional services to reduce poverty respectively. 5.1 Types of Micro-Finance Institutions in Nigeria The informants narrated that the types of microfinancial banking instututions in Nigeria consist of formal, informal, development and mortgage
Others include Community Bank, Public or government owned, private and foreign microfinance and : Formal Microfinancial institutions were design by the cenral bank of Nigeria purposely to provide financial services to the active poor population who were excluded from government financial institutions.Their services comprises of issuence of microcredits facilities, acceptance of deposits, facilitation of credit transfer and offering leasing as medium term finance
Summary
The expansion of micro financial institutions started earlier in the form of informal cooperatives societies, micro credit and savings by various communities in Nigeria (Taiwo, Alege & Olokoyo, 2016). The government of Nigeria established various policies and programs to cover 65 percent of the economically active population by the year 2020, improve the services of micro credit schemes, increase women access to financial services, jobs creation and poverty reduction.literature indicated an unequal distribution of microfinance banks in the country. Literature attested that Nigeria microfinance institutions are emerging with unique structures compared to other African countries the formalization policy of 2005 and effective 2008 transform community banks to MFIs. For instance in Zambia microfinance policies were unspecified but the government realizes the imperatives of under-banked; un-banked financial services for poverty reduction and established some regulations in the year 2006 (Siwale & Okoye, 2017).These problems motivated this study in order to explore the strategies to address these imbalances; disparity affecting the country and the north. The results were discussed and corroborated by previous studies.The recommendations; conclusion and references were as encapsulated. 1.1 Research Questions
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