Department of Banking and Finance
Permanent URI for this communityhttp://itsupport.cu.edu.ng:4000/handle/123456789/28763
Welcome to the page of the department of Banking and Finance
Browse
Search Results
Item Monetary Policy Rate And Poverty Reduction In Nigeria: The Role Of Microfinance Banks(Jurnal Akuntansi dan Bisnis : Jurnal Program Studi Akuntansi., 2025) Adesina, Tolulope; Makinde, Damilola Ayomiposi; Omankhanlen, Alexander EhimarePoverty remains a major socio-economic challenge in Nigeria, despite the expansion of microfinance banking aimed at enhancing credit access for low-income groups. However, the effectiveness of microfinance banks (MFBs) in reducing poverty is increasingly shaped by macroeconomic conditions, particularly the Monetary Policy Rate (MPR), which sets benchmark interest rates across the financial system. High MPRs raise borrowing costs, making loans less affordable for the poor and small-scale entrepreneurs who depend on MFBs for credit. This study investigates the impact of changes in the MPR on poverty reduction in Nigeria, focusing on how monetary policy influences the lending capacity of microfinance institutions. The study is theoretically grounded primarily in the Keynesian Theory of Interest Rate and Investment and the Monetary Transmission Mechanism Theory, which explain how changes in interest rates influence investment and credit flows in the economy. The Credit Rationing Theory further informs understanding of how lending constraints affect credit availability for low-income borrowers. A quantitative approach is adopted, using quarterly time-series data from 2008 to 2023. The Johansen Cointegration Test and Vector Error Correction Model (VECM) are employed to examine both long-run and short-run relationships among key variables. Results show that a 1% increase in MPR leads to an estimated 0.48 percentage point rise in the national poverty rate. In contrast, increases in the loan-to-deposit ratio and capital adequacy ratio of MFBs are associated with reductions in poverty levels. The study concludes that monetary policy decisions significantly affect poverty outcomes through their influence on microfinance operations. It recommends that policymakers adopt inclusive monetary strategies that support affordable microcredit, while maintaining macroeconomic stability, to enhance financial inclusion and reduce poverty.Item EFFECTS OF MICROFINANCE BANK’S ASSETS AND PRODUCTS ON POVERTY REDUCTION IN NIGERIA(Covenant University Ota, 2025-03) MAKINDE, Damilola Ayomiposi; Covenant University DissertationThis study investigates the effect of microfinance banks assets and products on poverty reduction in Nigeria. Specifically, it examines the impact of capital adequacy ratio, liquidity ratio, loan-to-deposit ratio, and monetary policy rate on the poverty rate. Using secondary data from the first quarter of 2008 to the fourth quarter of 2023, the study employs Vector Autoregression (VAR) analysis to assess these relationships. The findings indicate that the monetary policy rate has a positive and significant impact on the poverty rate, whereas the loan-to-deposit ratio, liquidity ratio, and capital adequacy ratio exhibit a negative and significant influence on poverty reduction. Based on these insights, the study recommends that microfinance banks enhance loan accessibility, strengthen capital reserves, and promote financial inclusion. Additionally, policymakers should regulate interest rates effectively and implement gender-inclusive strategies to support poverty alleviation efforts