Microfinance services and sustainable livelihood of rural households in Baler, Aurora, Philippines

Abstract

Microfinance expands financial access among low-income households, but its relationship with broader livelihood conditions varies across services and settings. This study examined access to microfinance services and its associations with sustainable livelihoods among rural households in Baler, Aurora, Philippines. A cross-sectional descriptive-correlational design was used with 521 households selected through stratified proportionate sampling across 13 barangays. Microfinance access was assessed through program enrollment, recent loan receipt, savings participation, microinsurance enrollment, and financial or livelihood training, while sustainable livelihood covered income stability, livelihood continuity, capacity to meet basic needs, and resilience to shocks. Data were analyzed using descriptive statistics, correlations, group comparisons, analysis of variance with Bonferroni post hoc tests, and separate multiple regression models controlling for household size, primary income source, and barangay. About one-third of households were enrolled in a formal microfinance program, while participation in savings, microinsurance, and training was lower. Sustainable livelihood was within the moderate descriptive range. All microfinance indicators were positively but modestly associated with overall livelihood (r = 0.157–0.247). Enrolled households reported higher livelihood scores than non-enrolled households, with a medium difference for the overall composite (d = 0.54). Positive adjusted associations remained for all indicators, while livelihood scores differed across primary income-source groups and were unrelated to household size. The findings suggest that microfinance access is one of several factors associated with rural livelihood conditions. Because of the cross-sectional design, the results should not be interpreted as causal effects.