Effect of financial risk management services on household poverty alleviation in Isiolo county, Kenya
Mohammed Doyo Abdullahi, Gladys Chepkirui Rotich
Poverty alleviation has been a foremost agenda for successive governments in Kenya over the years. Previous research has mainly focused on identifying the factors affecting the policy implementation process but there is limited literature with a focus on the role of microfinance services in development and specifically its effect on household poverty alleviation especially in Northern Kenya. The main aim of this study was to find out the effect of microfinance services on household poverty alleviation in Isiolo County. The study specifically sought to establish the effect of financial risk management services on poverty alleviation in Isiolo County, Kenya. The study adopted a descriptive research design to assess the extent to which Microfinance services correlates with household poverty alleviation in Isiolo County. The study targeted four microfinance institutions that have operated in the county for the last five years. The target population of the study constituted 4650 beneficiaries of microfinance services in Isiolo County. Out of the 4650 clients of microfinance institutions in Isiolo County, 368 respondents were sampled using Israel’s sample size determination formula of 2006. Systematic sampling was employed to obtain a representative sample size. The study used both structured questionnaires and interview guides to collect primary data for the study. The data were analysed using both descriptive and inferential statistics. The mean response for this objective was more than 3.0 and the skewness was between -1.96 and + 1.96 indicating normality of the data. The study concluded that microfinance services play an important role in enhancing household poverty alleviation. Financial risk management was considered to have the highest effect on household poverty alleviation. The study recommended that the microfinance institutions in Isiolo should put a lot of attention to enhancing credit facilities, ensuring capacity building in financial matters, and improving on financial risks management among the household to enhance household poverty alleviation among the households. The results are expected to be of great benefit to the various groups including the households, the government, and the microfinance institutions operating in Isiolo specifically and in Kenya generally.
Mohammed Doyo Abdullahi, Gladys Chepkirui Rotich. Effect of financial risk management services on household poverty alleviation in Isiolo county, Kenya. International Journal of Multidisciplinary Research and Development, Volume 8, Issue 9, 2021, Pages 151-160