Effect of Access to Financial Services on Poverty Reduction in Jomoro Municipality

Abstract

ABSTRACT Poverty is a social problem that has eroded the quality of life of people, particularly those in the rural communities. At the same time, rural communities are found to have limited access to financial services such as micro-insurance, savings and remittances, and credit. This study, however, investigated the effect of access to financial services on poverty reduction in the Jomoro Municipality of Ghana. Access to financial services was proxied by three measures including access to credit, access to savings and remittances, and access to micro-insurance. The study employed the quantitative design and used both descriptive and regression analysis to assess the relative and combined effect of access to credit, access to savings and remittances, and access to micro-insurance on poverty reduction. The study obtained primary data from 399 households‟ members from the Jomoro Municipality in the Western region of Ghana. The main finding obtained from the study was that access to financial services in the form of access to credit, savings and remittances, and micro-insurance contributed to reducing poverty. The study recommends that rural households‟ members should imbibe the practice of savings while financial institutions such as insurance companies and banks should also assist rural households‟ members by extending access to credit and insurance to them so as to help reduce poverty.