THE CONTIBUTION OF MICROFINANCE COMPANIES FOR POVERTY REDUCTION IN SUNSARI DISTRICT

Abstract

In order to provide suggestions that may help increase the effectiveness of microfinance programs, this study looks for ways that these programs can enhance the participants' standard of living and economic empowerment. The current study combines qualitative and quantitative methods to conduct research using a descriptive and causal comparative research design. The planned sample size was 300 respondents from various microfinance organizations. The convenience sampling method was employed in the data gathering process, and the basic random sample method was used to distribute the questionnaires. The study's dependent variable is poverty reduction, while its independent variables are social status, wealth, education, health, and living standards. According to the study's findings, poverty reduction is positively impacted by the variables of money, education, social position, health, and living standard. In particular, poverty reduction is positively impacted statistically significantly by the variables of money, education, and living standard. On the other hand, although the effects are not statistically significant, health is also linked to lower levels of poverty. The analysis of the current study has revealed a very significant positive association between poverty and the main components of multidimensional poverty—wealth, education, health, and standards of living—which show the aspects under which microfinance is most effective in addressing poverty.