Moderating Role of Financial Literacy on the Relationship between Religiosity, Microfinance Access and Poverty Reduction among Muslim Women Entrepreneurs in Bauchi City- Nigeria

Abstract

The level of poverty among Muslim women in northern Nigeria presents a recipe for societal downgrade. While studies have investigated the nexus between religiosity, access to finance and poverty reduction, the findings have been mixed and inconclusive. The main objective of this study is to examine the moderating role of financial literacy on the relationship between access to Islamic micro finance, religiosity and poverty reduction among Muslim women in Bauchi State, Nigeria. A stratified sample of 164 women made up from 4 stratums involved in soya bean, ground nut, rice and other micro processing vocations were randomly selected to participate in the study. Using PLS-SEM, with the utility of Smart PLS 2.0, the study revealed that access to microfinance and financial literacy have positive and significant influence on the poverty reduction of Muslim Women Entrepreneurs in Bauchi state metropolis. Similarly, the study established that the relationship between religiosity and poverty reduction is conditional on financial literacy of Muslim Women Entrepreneurs. On the contrary, the study neither establishes the effect of religiosity on poverty reduction nor establishes the moderating effect of financial literacy on the nexus between access to microfinance and poverty reduction.  The study recommends that government and financial institutions should pay special attention to boosting the financial literacy level of Muslim women entrepreneurs in Nigeria.