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ID: 77072937


19th OCTOBER, 2009.

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Table of contents
1.1.0 Background of study 1.1.1 Structure of literature review 1.2.0 Significance of study 1.3.0 Research questions and objectives 1.3.1 Research questions 1.3.2 Research objectives 1.4.0 Research methodology 1.4.1 Research design 1.4.2 Data collection 1.4.3 Ethical permission 1.5.0 Time scale

4 7 8 9 9 10 11 11 12 13 14 15 17-18

1.6.0 Resources References Appendix 1: 19 Appendix 2: Ethics Form

Map showing Sagamu Local Government Area



2004) Schreiner and Colombel (2001: 339) and McGuire and Conroy (2000: 90) define microfinance as “the attempt to improve access to small deposits and small loans for poor households neglected by the banks. (McGuire and Conroy. government banks. commercial banks. (Elahi and Danopoulos. raises moral questions bordering on who handles finance profitably and who has the capacity to repay credits received and responds to policy changes better than the other sex. 2000: 94-95) The stakeholders of microfinance include donors. (Anyanwu. it is a win-win programme. (Chemin. however. . 2009. microentrepreneurs. Nongovernmental Organisations (NGOs). government. and other individual beneficiaries. on the other hand is viewed as a development tool. thrift societies (credit and loan cooperatives). 2008). non-bank financial institutions. who questioned the rationale behind the goals and expectations put in place by the Microcredit Summit. 2005) That women are given primary consideration in microfinance programmes does not suggest that the male gender is discriminated upon. This. On the other hand are critics such as Dale Adams of Ohio State University. credit unions. microfinance banks. Chowdhury. Most studies on poverty alleviation and microfinance concentrated on women (Elahi and Danopoulos. (Johnson. who described the microfinance industry as ‘microdebt industry’ and Gonzalez-Vega.Page |4 The term microfinance is often used interchangeably with microcredit and connotes a financial venture with interest in rendering services to the poor although with profit-making in view. 2000) McCarther (2006) posits that women are the reason behind the success of microfinance as they are better clients and key drivers of development. 2005) Proponents of microfinance agree that it has the tendency to break poverty’s vicious cycle. essentially the dispersion of small collateral-free loans to groups of jointly liable borrowers in order to foster income generations and poverty reduction through enhancing self-employment and health.” Microcredit. The rationale being that they are prone to rural poverty than their male counterpart. 2004: 62). (Ahmed.

The study posits that 40% of Bangladeshi citizens live below the poverty line. without indebtedness.Page |5 Bangladesh. and in consequence fell into further. being the traditional home of microfinance development. The objective of the study was to examine “if microfinance contributes to the reduction of poverty in the Mekong Delta region of Vietnam. However. (Chowdhury et al. Association for Social Advancement. 2008: 191) .” The finding of the research “suggests that the process of the accumulation of assets. The results of the study show that microcredit is linked with poverty and its impact is only strong for about 6 years with subsequent decline. Bangladesh Rural Advancement Committee. a similar research was conducted in the Mekong Delta by Rajula et al (2008). The credit defaulters had to borrow from other sources to repay the loans.” (Rajula et al. (Haque and Yamao. prolonged indebtedness. 2005) Another Bangladeshi study conducted by Haque and Yamao (2008) focused on determining how capably microcredit can alleviate poverty in Bangladesh. the study showed that proper utilization of microcredit can improve the livelihood of Bangladeshis.” Second and third objectives were to investigate “if it leads to the accumulation of assets” and “how poor women are enabled to adopt livelihood strategies that lead to poverty reduction. Thengamara Mohila Sabuj Sangha among others who had been borrowing from institutions for more than 6 years were sampled. Women members of reputable Non-governmental Organisations and Microfinance Institutions including Grameen Bank. 2008) A closely related work was also done in Bangladesh by Ahmed (2009) In the case of Vietnam. has witnessed increased studies. One such study concentrated on both objective and subjective poverty with emphasis on the number of times participants have had access to microcredit. The outcome of the study showed that credit disbursed was not sufficient for profitable economic activities let alone paying back the weekly installments. leads to the creation of livelihoods that result in increased household income and poverty reduction.

Mbieri. Sweden entitled Microfinance and Poverty Alleviation. according to the clusterrandomised trial conducted in rural South Africa by the Intervention for Microfinance for AIDS and Gender Equity (IMAGE). This is a research gap identified by this researcher that formed the basis for his choice of research topic. Result shows that midwives were very interested in microfinance. Ewhrujakpor (2008) emphasized that poverty in Nigeria is the direct consequence of decreased investments.Page |6 A study was conducted in South Africa by Kim et al (2007) with an objective to prove that women empowerment leads to significant reduction in intimate partner violence. The failure of antipoverty initiatives.” The study conducted by Irobi Nnenna Christiana in 2008. and how it affects the welfare of different groups of individuals and . From the Nigerian perspective. His review of the Poverty Alleviation programme. “the pervasiveness and persistence of poverty in [Nigeria] is a massive betrayal of her rich resource base. a study was conducted in Uganda by Agha et al (2004) and centred on client perception of the quality of care provided by midwives. A Case Study of Obazu Progressive Women Association. the beneficiaries of microfinance. output. It further shows that microfinance have the capacity of strengthening private sector health services. Results show that empowering women economically and socially can contribute significantly to intimate gender violence reduction. Uppsala. Imo State. The study verified the impact of a microfinance scheme that provided relevant business skills and revolving loans on client loyalty. with its attendant negative implications may not be unconnected with the pervasiveness of perverse incentive structures that engender and nourish opportunism at the expense of a fairly even distribution of income and wealth. Still in Africa. a degree thesis of the Sveriges Lantbruksuniversitet. The implementation of government policies is left in the hands of people who betray the confidence of the masses. Nigeria focused on women. National Economic Empowerment and Development Strategy (NEEDS) shows that reducing poverty in Nigeria is the most difficult challenge and obstacle in her pursuit of sustainable economic growth. According to Shola (2008: 496). income purchasing power and savings.

Interestingly.) with the assistance from the credits received from the association. A Case Study of Country Women Association of Nigeria (COWAN). The researcher focused on loans (by COWAN) granted to “poor women who don’t have two dollars of their own to start any meaningful business” and who do menial jobs.1 Structure of literature review The review of literature of this study will take the following format: 1. “Result showed that loan facilities from COWAN has positive influence on the level of income.1.” (Fasoranti. entitled Economic Implication of Poverty Alleviation Programs on Rural Women in Ondo State. which engage in microfinance activities. this study found that most women in this association experienced increased income and therefore improved their economic status. The findings of the study showed that “the microfinance intervention has a positive impact on the alleviation of poverty among women of this association. Understanding the concept of poverty o What is poverty? o Causes of poverty . trading etc. the result of the return to scale analysis showed efficient utilisation of the loans. Multistage sampling technique was used to select 100 respondents from Ikare and Ugbe from Akoko NorthEast and Oka and Okungba from Akoko South-West.Page |7 households. The study examined the economic implication of COWAN poverty alleviation programme on rural women. The researcher’s objective was to determine the rural women’s (the beneficiaries) experiences in business (such as farming.” (Irobi. dress making. 2008: 352) 1. in Imo State. was chosen because “it is one of the villages that rural women.” Empirical data were collated using informant interview and questionnaire methods. live. 2008: vii) Another study was conducted by Fasoranti Mary Modupe in 2008. Mbieri. political and social conditions after receiving the loans.

The concept of microfinance o History of microfinance outside Nigeria • The Shore Bank case • The Gramen Bank case • The Bangladesh Rural Advancement Committee case o History and challenges of microfinance in Nigeria o Differences between microfinance and global banks o Objectives and roles of microfinance 4. Alleviating poverty through micro-financing o Stakeholders o Legal frameworks 5. World Bank poverty alleviation initiatives in Nigeria 6.Page |8 o Measuring poverty 2. Poverty alleviation o Issues and challenges o Interventions 3. Understanding the study area o Nigeria o Ogun State o Sagamu local government area 1.0 Significance of the study .2.

therefore.Page |9 Following the presence of microfinance institutions in Sagamu Local Government Area in Nigeria.0 Research questions and objectives The following research questions and objectives will be treated in this study: 1. and non-support. be useful to the micro and medium scale enterprises that require or use microfinance banks. the poor in Nigeria (especially Sagamu settlers) who may not be aware of the microfinance options available to them and have missed out on several opportunities to lift themselves out of the poverty rot. seeing that the dwellers continue to deteriorate toward penury. and by extension the microfinance institutions which serves this fundamental purpose.3. and will examine the concept of microfinance in Nigeria. in answer to the research questions. 1. The study will. neglect.1 Research questions .3. poverty. This study will include both economically capable men and women – the beneficiaries of poverty alleviation programmes. this study is significant to deciphering their roles in alleviating poverty within the local government.

2 Research objectives: 1. for comparative analysis of the Nigerian situation. How do microfinance schemes alleviate poverty in Nigeria? How do microfinance institutions understand the concept of microfinance in Nigeria? 2. 2. . To achieve the above.3.P a g e | 10 1. The researcher will also take a cursory look on the extent of understanding of the strategic roles expected of microfinance institutions and how much (or little) these institutions understand their socio-economic role. 1. To examine the role of microfinance schemes in poverty alleviation in Nigeria. The researcher intends to explore ways that microfinance schemes have alleviated poverty in Sagamu local government area of Ogun State. To clarify the concept of microfinance for a better understanding by institutions and beneficiaries. interview questions and questionnaire items will be tailored to the issues raised above and data analysed using SPSS. Nigeria borrowing insight from Bangladesh and select third world countries.

and relevant records obtained through permission from agencies and beneficiaries.4.4. Interview and questionnaire items will be structured to capture data on corporate understating of the microfinance concept. It further describes the procedures that were followed and instruments used in relevant data collection and analysis. Data gathered through the questionnaire will be examined using SPSS.0 Research methodology This section focuses on the procedures to be used in this study to examine the role of microfinance schemes in poverty alleviation in Nigeria and the comprehension of its concepts. Cases of countries in. On the other hand. It restricts the study to the description of the methods used in data collection and analysis in order to arrive at research conclusions. personal observation. Asia. 1.1 Research design . and Africa will be comparatively reviewed to better understand the concept of microfinance. 1. South/Latin America. the concept of microfinance will be comprehensively explored in the review of literature.P a g e | 11 The first objective will be achieved through guided interviews.

The choice of these samples is to ensure that no detail within the reach of the researcher is left out.P a g e | 12 To achieve the objectives of this research. There is no middle class. their areas of focus and modes of operation so as to measure each microfinance institution’s impact on poverty alleviation through the many schemes they implement. The researcher will sample officials of microfinance institutions.4. The researcher found out that although there exist microfinance institutions. Nigeria. The study will be conducted in Sagamu local government.2 Data collection . to visibly isolate the microfinance institutions represented in the local government. local government officials and beneficiaries (expected and current) of poverty alleviation programmes. 1. the researcher will undertake a tour of Sagamu local government. just a hollowed gap between the super-rich and the poor. The researcher’s interest in Sagamu arises from his many trips to the local government in recent times. a significant number of Sagamu dwellers continue to live in poverty.

Statistical . secondary data collected from two (2) institutions/day (1 week).P a g e | 13 The researcher will interview fifty (50) carefully selected respondents (beneficiaries and institutional). administer forty (40) questionnaires on respondents (beneficiaries and institutional). To achieve this. The aim of applying these methods is to explore individual and corporate opinions about the success or failure rate of microfinance schemes as well as to explore the concept and workings of microfinance. The researcher will creatively interact with people of the communities in order to gather interesting data to facilitate this study. It is projected that data collection will be concluded in four (4) weeks: four (4) interviews/day plus questionnaire administration (3 weeks). The interviews will be recorded using an electronic storage device and subsequently analysed using Nvivo software. Data (records) detailing the modes of operations in poverty alleviation schemes embarked upon will be sought from the local government and ten (10) microfinance institutions. he plans to pay personal visits to selected respondents (beneficiaries and institutional) at their business places.

Responses to questions would be coded. charts. administering the research instrument (questionnaire). objective interpretations.P a g e | 14 Package for Social Sciences (SPSS) will be used to analyse the returned questionnaires using descriptive statistics. graphs. The objectives will be tested using simple regression method. permission will be sought from relevant .4. etc. and other data collection method suitable for this study. mode and median indicated. 1. tabulated and processed using the Statistical Package for Social Sciences (SPSS) software and will be analyzed using frequencies with mean.5 Ethical Permission Before embarking on interviews. Deriving from the above. Findings will be deduced from these followed by logical conclusions which will form the basis for appropriate recommendations. Other data will be statistically treated for scientific. data will be presented in tables. Dependent and independent variables will be used for regression analysis. Percentages will be worked out to indicate positions with measures of central tendencies and measures of dispersions.

P a g e | 15 individuals and departments of agencies to be sampled. Stages 1. to give a clear idea of the duration of study. This is to avoid unauthorised acquisition of data and rights infringement. Please find attached a copy of ethics form as instructed by the school authority. This will form part of my proposal to relevant agencies whose staff I intend to seek data and documents for analysis so as to facilitate my findings. Commercially sensitive data will be handled with utmost discretion and for analytical purpose only. The researcher intends to avoid request for names of respondents. 3. 4. as this will not form the basis for analysing the research instruments. 2.5. Study Review of literature Data collection Data analysis and presentation Research publication conclusion Duration 4 weeks 4 weeks 4 weeks and 2 weeks .(see Appendix 2) 1.0 Time Scale To guarantee viability. the researcher has divided this study into phases.

1. a Researcher at ValueFronteira Limited. Nigeria and a part-time Strategic Management Lecturer at Strategic Business School.P a g e | 16 Due to unforeseen occurrences. However. Nigeria has been . some ‘slippage time’ has been designed into this study to ensure viability. Mr.0 Resources The researcher will require the following resources. Lagos. Lagos. it is possible for this study to take longer than expected.6. to ensure the timely success of the research project: ⇒ A laptop computer for publishing reports ⇒ A functional mobile internet modem for online research ⇒ Assistance from staff of local government and microfinance agencies to gain access to data ⇒ An electronic voice recording device for the conduct of interviews ⇒ Two (2) adhoc staff for questionnaire administration ⇒ Writing materials ⇒ Finance to facilitate mobility In addition. Sunday Nse.

and research conclusions.P a g e | 17 contacted to train me on questionnaire design and the use of Nvivo and Statistical Package for Social Sciences (SPSS) software for data analysis. analysis. However well planned the resources put in place to facilitate this research are the researcher expects some limitations. These limitations will in no way adversely affect data collection. References .

M. pp. 2081-2098. The impact of a microfinance programme on clients perceptions of the quality of care provided by private sector midwives in Uganda. 5(4). Gender impact assessment in microfinance and microenterprise: Why and how. Journal of Development Studies. 44(4). The benefits and cost of microfinance: Evidence from Bangladesh. Journal of Health. pp 519-531. M. Progress in Development Studies. R. N. 463-484. Imo State. pp 352-356. and Wright. E. Ghosh. 27(4).. J. 298-309. Microfinance and poverty alleviation: A case study of Obazu Progressive Women Association. pp 435458. pp. (2004). 89-93. P. Part 2. Elahi. Anyanwu. (2000). M. Bangladesh. Uppsala. 39(6). Can microcredit alleviate rural poverty? A case study of Bangladesh. Poverty and its alleviation: The Nigerian Experience. C. S. 4 (4). D. Microfinance and third world development: A critical analysis.P a g e | 18 Agha. and Ogojo-Okello. Haque. pp. (2008). 32(1). (2009). . 528. Johnson. (2008). Master. determinants and exit paths. 36. and Danopoulos. pp. 51 (4). Fasoranti. International Centre for Diarrhoeal Disease Research. Economic implication on poverty alleviation programs on rural women in Ondo State. F. Journal of Political and Military Sociology. (2004). M. J. and Yamao. (2008). Balal. (2005). African Development Bank. pp. C. (2008). Population and Nutrition. Irobi. Journal of Social Sciences. A. Health Services Research. pp 2-5. a case study of Country Women Association of Nigeria. Proceedings of World Academy of Science. (2008). S. (2005). S. C. Nigeria. Rural poverty in Nigeria: Profile. Chowdhury. M. International Social work. M. Capability development among the ultrapoor in Bangladesh: A case study. Ahmed. pp. M. S. Development in Practice. The impact of microcredit on poverty: Evidence from Bangladesh. Engineering and Technology. Sveriges Lantbruksuniversitet. A. 61-77. Vol. Mbieri. K.. Ewhrujakpor. Q. Chemin. C. 10(1).

pp.. The microfinance phenomenon. McCarther. C. University of Maryland Law Journal of Race. P. 7. J.. African and Asian Studies. (2008). H. J. H. C. 6. pp. Phetia. P. Porter. Development Policy Review. Schreiner. 7(1)... and Conroy. H. B.. (2008). M. P. Hargreaves. D. X. Shola.. E. (2006). Rajula. L. Religion. From urban to rural: Lessons for microfinance from Argentina. Morison. 1794-1801.... 19(3). pp 496-517. 339-354. Microfinance and poverty reduction in the Mekong Delta in Vietnam. pp. 12 (4). Watts. B. T. L. Journal of poverty. Nguyen V. 353-366. Asia-Pacific Review. J. Busza. 97(10). J. (2007). and Vo V. Understanding the impact of a microfinance-based intervention on women’s empowerment and the reduction of intimate partner violence in South Africa.P a g e | 19 Kim.. pp. H. (2000). Ndhlovu.. Combating poverty for sustainable human development in Nigeria: The continuing struggle. and Pronyk. Gender and Class. (2001). R. S. A. Women and microfinance: Why we should do more. G. and Colombel. O. J.. . 191-215. D. American Journal of Public Health. 90-106. J. McGuire. S.

P a g e | 20 APPENDIX 1: Map Showing Sagamu Local Government Area Map data ©2009 Europa Technologies (Powered by Google) .

African Development Bank. and Ogojo-Okello. J. A. The impact of a microfinance programme on clients perceptions of the quality of care provided by private sector midwives in Uganda. F. Population and Nutrition. S. C.P a g e | 21 APPENDIX 2: Research Ethics Release Forms LOCAL LEVEL AUTHORISATION: POSTGRADUATE RESEARCH PROJECT Project not involving human participants Name : ADEYINKA ADEKUNLE ILORI Programme : MSc Contemporary Accounting Project Title :. 528.. 39(6). Part 2. Health Services Research. pp. 27(4). 2081-2098. OGUN STATE. M. Ahmed. pp. International Centre for Diarrhoeal Disease Research. Capability development among the ultrapoor in Bangladesh: A case study. (2005). Balal. Journal of Health. (2009). S. Rural poverty in Nigeria: Profile.) Sources to be used Agha. NIGERIA. . (2004). Bangladesh. determinants and exit paths. Anyanwu.POVERTY ALLEVIATION IN NIGERIA: THE MICROFINANCE APPROACH (A CASE STUDY OF SAGAMU LOCAL GOVERNMENT AREA. pp 435458.

The benefits and cost of microfinance: Evidence from Bangladesh. and will not undertake such research unless and until approval is granted. and Wright. J. (2008). I also understand that I am required to abide by the terms of this authorisation throughout the life of the project. (2005). Chowdhury.. Journal of Development Studies. 2009 Supervisor’s agreement Name Signature Date ……………………………… ……………………………… ………. D. Ghosh. 44(4). R. A. pp. 5(4)... Signed Date ILORI ADEYINKA ADEKUNLE October 1. Student Undertaking I confirm that I am proposing to undertake this research project in the manner described. I understand that if I infringe the terms of this authorisation my work may not be marked. Authorisation– Research Ethics Co-ordinator Name Signature Date …………………………… ……………………………… ………. E. The impact of microcredit on poverty: Evidence from Bangladesh. and that if I subsequently wish to involve human participants or human subjects I will seek approval for this immediately. .P a g e | 22 Chemin. M. 463-484.. Progress in Development Studies. I understand that I may not approach any human participants or involve human subjects in the course of this work. M. pp.

P a g e | 23 This form will be retained for the purposes of assurance of compliance and audit for the duration of the research project and for five calendar years thereafter. .

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