| Abstract: | Poverty is a harsh and undesired phenomenon in mankind. Reducing, if possible
eradicating poverty is unquestionable. Thus, microfinance programs have been
considered as one of the main instruments in poverty reduction in recent
development agenda. It is a means to support the marginalized active poor of the
society. Studying the impact of microfinance intervention is important to assess its
viability on poverty reduction. The main objective of this study was to assess the
impact of microfinance services of MFIs in Ethiopia and the changes it has
brought on the living standards of clients. It was focused on the impact of SFPI
program at household and enterprise level.
The study was conducted at the branches of the FSPI by employing the “before”
and “after” method so as to evaluate the impact of the microfinance institution on
reducing the poverty level of its clients.
Primary data was collected using structured interview, FGD, and observational
check-list while secondary data was obtained from the records, journals,
proceedings, bulletins, internet and various books. Multistage sampling method
was employed to take a sample of clients from the total. Both descriptive and
inferential statistics such as mean, percentages, Wilcoxon signed rank rest and
independent two sample t-test was employed.
In general the credit scheme has increased the mean income of respondents and
had improved the ownership of different productive assets, such as, oxen, cows
and others. SFPI program has made a positive impact on households’ income,
asset ownership, housing condition, expenditure, diet condition,’ access to
education and medical facilities. SFPI credit delivery has also improved
enterprises’ production capacity and employment opportunity of the local
community.
And there was no significant difference between the sexes regarding the socioeconomic
variables except for saving and the level of income after loan. MFIs
have significantly contributed towards improving the living standard of the poor
and reduce poverty at household level. Therefore, strengthening the development of |
