The Role of Microfinance on Poverty Reduction: A Case Study of Adansi Rural Bank in Ashanti Region, Ghana

The focus of microfinance institutions has moved from just the provision of microcredit to the provision of different financial services and products that meets the needs of their target market. This study investigates the role Microfinance plays in alleviating poverty. It also aimed at examining the sustainability of the Microfinance Program and its effect on its clients. The study adopted a descriptive and explanatory approach. The research further used both quantitative and qualitative data collection and analysis. Cluster and purposive sampling of selecting respondents were adopted. In all, one hundred and twenty respondents consisting of one hundred and ten (110) clients and ten (10) staff were used. The research findings proved that there is a highly significant association between increase in income level and savings which leads to a positive impact on the financial situation of families. It further proved that microfinance activities bring improvement in the standard of living of the participant not only in economic terms but also in social terms. Although MFIs are emerging as important players in the country’s banking and financial system, a substantial segment of the poor population remained underserved. These are mostly people in the rural communities who are very poor.