Microfinance as a Panacea for Economic Empowerment of the Poor in Nigeria

Interest in microfinance has soared in the recent time and the instrument is now seen as one of the most potent tools to tackle poverty in the developing countries. Nigeria with the worst poverty situation has therefore embraced the strategy. This paper has pictured microfinance as a financing strategy for poverty alleviation, and hence economic empowerment and emancipation of the poor in Nigeria, and the challenges it faces. The analyses contained in the paper are the results of a survey conducted by the researcher on twenty eight microfinance schemes operating in Zone ‘A’ Senatorial District of Benue State of Nigeria. The data collected were analyzed using simple percentages and the results revealed that, although microfinance schemes in the country have contributed to alleviating poverty, a myriad of problems still trails them. Prominent among them are inadequate funds and diversion of credit facilities by beneficiaries. Based on this, the paper suggested that government should beef up the schemes’ financial bases through soft lending. The schemes on their part should put in place adequate and functional arrangements that would ensure proper monitoring of beneficiaries to forestall diversion as well as ensure prompt loan repayment.