INFORMAL MICRO FINANCING AND IMPLICATIONS ON STATUS OF POVERTY OF WOMEN FARMERS IN ABIA STATE, NIGERIA

This study on informal micro financing and its implication on status of poverty of women farmers was carried out in Abia state, Nigeria, with specific objectives to: describe selected socio-economic characteristics of women farmers who accessed microcredit from informal sources; analyze poverty profile of women farmer beneficiaries of informal microfinance before and after accessing the informal micro-finance; and analyze effects of micro-credit received from informal sources on farm income, poverty line and value of fertilizers used by women farmers. Primary data collected from 233 women farmers selected using multi-stage random sampling technique was analyzed using descriptive statistics, measures of poverty indices and paired t-test analyses. The mean age of women farmers was 45 years and their households had a mean size of 5 persons. Majority (72.10%) of the women had no contact with extension agents and (65.52%) of them were engaged primarily on farming. Indices of their poverty incidence were 0.6481 and 0.6223 before and after access to informal credit; the indices of their poverty gap before and after access to informal credit were 0.4135 and 0.4074 respectively. The paired t-test of difference of poverty line, farm income and value of fertilizer used by the women farmers before and after taking informal credit were significant and positive at 1.0% risk level. In light of the revealed relevance of informal micro-financing to poverty reduction and development, informal financial institutions should be functionally recognized and encouraged in Nigeria’s financial system. To this effect, government should redesign her regulatory policies to encourage operations of the major organizations in the informal financial sector. However, such regulations should not be framed in a way that will totally cripple or paralyze organization’s activities, but to effectively enhance their performance for maximum contribution to livelihood of the poor especially the women farmers.