Abstract

Some rural development experts consider micro-financing as a panacea for food insecurity and rural poverty alleviation. Development policies in favour of the rural poor using micro-financing have had positive but insufficient impacts on the conditions of poverty. The study uses a combination of primary and secondary data to make a spatio-temporal analysis of micro financing based on the innovation diffusion model. It appraises the techniques of micro credit diffusion, maps the spatial diffusion trends and analyses the evolution of the adoption process. The study like previous ones concludes that the micro credit scheme has had positive but insufficient impacts on agricultural development. It therefore identifies the bottlenecks in the use of micro financing in favour of the rural poor and the scope to achieve a successful design of a community-based financial institution which is best adapted to rural realities and will be accepted by local financial institutions and by the rural people alike. Micro financing should aim at making available financial and technical assistance to the poor by adapting to local realities, linking structures with the informal financial sector of the micro economy and innovating institutions and procedures for access to credit.

Key words: Spatial diffusion, temporal diffusion, micro-finance, core-periphery, innovation adoption, agricultural development.