Title: Effects of Credit Access on Poverty Reduction Among Rural Households in Masaka District, Uganda
Authors: Nambaale Denis
Shafie Ali Salad
Volume: 10
Issue: 1
Pages: 210-218
Publication Date: 2026/01/28
Abstract:
The study aimed to examine the effects of credit access on poverty reduction among rural households in Masaka district, Uganda. The Self-Help Group theory propounded by Muhammad Yunus in 1983 and the Social Capital Theory advanced by sociologist Pierre Bourdieu in 1985 were guided by the study. The study adopted a mixed approach using a convergent parallel research design. Yamane's (1967) formula was employed to determine the sample size of the study. Both purposive and random sampling techniques were employed to select the respondents. The study employed both survey and interview methods. Quantitative data were collected using a structured questionnaire. Qualitative data were collected through interviews using an interview guide administered to key informants. The validity of the research instruments was assessed using the Content Validity Index (CVI). Reliability of the quantitative instrument was tested using Cronbach's alpha coefficient. The regression analysis reveals that credit access has a very weak and statistically insignificant effect on poverty reduction among rural households in Masaka District, accounting for only 0.5% of the variation in poverty levels. This suggests that other factors beyond credit access play a more substantial role in poverty reduction in Masaka district, Uganda. The study concluded that while credit access may provide some economic benefits, it should not be considered a standalone solution for poverty reduction in Masaka district, Uganda. The study recommends combining affordable credit with financial education, flexible loans, and simplified application processes. The government and financial institutions should collaborate to improve access, while supporting skills training and job creation to effectively reduce poverty levels.