Abstract
The challenge Ethiopia is facing today is to reduce poverty and gear up the living standard of its people. One of the poverty reduction policies of the country therefore is the introduction of micro financial institutions to empower the economically marginalized segments of the society. Amhara credit and saving institution (ACSI) is one of the largest micro finance institutions operating in Ethiopia established in accordance with proclamation no. 40/1996 The objective of this study, therefore, is to find out whether Amhara Credit and Saving Institution (ACSI) has made changes on living standard of the clients based on tropical livestock unit and Income change, while the other objective is whether ACSI reduces the income gap between program clients and non-clients. Primary data were collected through structured questionnaire from clients and non-clients using simple random sampling method. Both are quantitative and qualitative in nature.Descriptive analysis and dichotomous binary model were applied in the study. The impact study was analyzed based on socio economic variables. The finding of the study indicated that the ACSI’s micro financing program has made positive contribution to its clients in relation with the observed variables in the study area. Therefore, attention should be given in strengthening the prevailing operation of the Amhara Credit and Saving Institution. Keywords : Impact; ACSI; logit regression; Ethiopia; Gini coefficient; Tropical livestock unit. DOI: 10.7176/RJFA/11-23-05 Publication date: December 31 st 2020
Highlights
By any standard, the majority of people in Ethiopia are among the poorest in the world (DERCON and KRISHNAN, 1998; IMF, 1999; RAHMATO and KIDANU, 1999; WORLD BANK, 2001)
Method of Data Analysis As suggested by USAID’s AIMS project the cross-sectional impact analysis method was applied between frequent borrowers who have been in the program for two years or more and non-clients as a control group
From the total sample respondents, 158(57.25%) are male and 118(42.75%) are female. while the ages of respondents 110 (39.85%) are in the range of 31-40, 109 (39.49%) are in the range of 41-50. This implies that the ages of most respondents lie in the range of age between 31 and 50 and the average age for frequent men clients was 42.3years old and for women clients was 41years.Whereas for men non clients, the age was 43.7years and for that of women clients was 39.4years
Summary
The majority of people in Ethiopia are among the poorest in the world (DERCON and KRISHNAN, 1998; IMF, 1999; RAHMATO and KIDANU, 1999; WORLD BANK, 2001). Poverty seems to persist in large sections of the rural society with little hope for a substantial improvement of the living conditions of the rural poor in the near future. In order to combat such debilitating poverty considering very scarce financial resources available to be allocated for the purpose, we have to understand the determinants of poverty in rural Ethiopia. The policy makers always support micro finance institutions to reduce poverty. Poverty reduction has been the objective of unprecedented attention at international summits in the 1990s (Jonathan, 2002). Webster and Fidler (1999), viewed the access to financial service to the poor in terms of its ability to help them to escape from poverty.
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