ABSTRACT:

The study assesses the effects of microfinance banks in Kogi State on rural dwellers in Kogi state. A survey research method was adopted. A sample of five microfinance banks was selected using judgmental sampling method. Data were generated through questionnaire, interview and of course, the internet. Z – Test statistical tool was used to test the formulated hypotheses. The study reveals that the establishment of microfinance banks has significant impact on the life of the rural dwellers in Kogi State by mobilizing savings for financial intermediation and providing employment opportunities. The implication is that Microfinance banks have the potential of improving the economic potentials of the active poor in the rural communities, thereby increasing their productive output. The study recommends that the Central Bank of Nigeria should reduce their prime rate charged in order to enable microfinance financial institutions reduce their interest rates. Also rural dwellers should be trained on how to establish, manage, sustain and expand their business outfits to making the services of microfinance worthwhile.