Impact of Microcredit on Poverty Reduction among Economically Active Poor in the Kumasi Metropolis

Abstract

The study examines the impact of microcredit on poverty reduction among economically active poor in the Kumasi Metropolis. The study was a cross-sectional survey covering four Savings and loans companies in the Kumasi Metropolis. A sample of 338 was drawn through purposive sampling. The data were collected through questionnaire. Data were analyzed using Independent-Sample T Test and Multiple Regression with p-value≤0.05 as significant. The study found that microcredit had significantly improved incomes, access to education, healthcare but not savings and purchase of consumer durable items like cooking stove and fridge. Group credit significantly impacted on poverty reduction more than individual credit but emergency credit to economically active poor did not have significant positive impact on poverty reduction. The study recommends microcredit as a strategy for poverty reduction in the Kumasi Metropolis.