The mediating role of micro-entrepreneurship between microfinance and poverty alleviation: Entrepreneurial training as moderator

Purpose: This paper aims to evaluate the impact of microfinance on the alleviation of poverty. The paper also tests the mediating role of micro-entrepreneurship and the moderating role of entrepreneurial training in the microfinance and poverty alleviation relationship. Design/Methodology/Approach: The research is based on the cross-sectional data collected from 400 beneficiaries of the National Rural Livelihood Mission (NRLM) Scheme through a pre-tested questionnaire. The data was analyzed by using regression analysis, ANOVA, and t-test. The mediation and moderation analysis was done using PROCESS macro developed by Andrew Hayes.Findings: The results suggest that access to microfinance has enhanced beneficiaries' living standards and health, whereas the education of the children of beneficiaries has been negatively impacted. The results also revealed a mediation role of micro-entrepreneurship and a moderation role of entrepreneurial training in the relationship between microfinance and poverty alleviation. Research Limitations/Implications: The study is based on cross-sectional data and can be replaced by a longitudinal research design. Moreover, this study focused only on the experimental group, thus, ignoring the control group. Further research could be done focusing on both experimental and control groups. Practical Implications: The findings from the study apprise the decision-makers and the microfinance proponents about the significance of micro-entrepreneurship and entrepreneurial training in enhancing the impact of microfinance among the deprived sections of society, particularly in rural India.Originality/Value: This paper is the first to check the mediating role of micro-entrepreneurship and the moderating effect of entrepreneurial training in the microfinance and poverty alleviation relationship.