Evaluating Income Stability, Financial Behaviour and Loan Repayment Culture Among Microfinance Clients in Kwara State, Nigeria

This study examined the effects of income stability and financial behaviour on loan repayment culture among clients of licensed microfinance banks in Kwara State, Nigeria, grounded in Friedman's (1957) Permanent Income Hypothesis and Ajzen's (1991) Theory of Planned Behaviour. A quantitative cross-sectional survey design was adopted, and primary data were collected in 2026 through a structured Likert-scale questionnaire administered to 216 valid respondents from a target population of active loan customers, selected through a purposive-then-random sampling procedure. Data were analysed using descriptive statistics, Pearson correlation, and multiple linear regression in SPSS v23. Instrument reliability was confirmed across all three scales (Cronbach's α ranging from 0.812 to 0.847). The regression model was statistically significant (F = 126.44, p < 0.001) and explained 54.2 percent of the variation in loan repayment culture (R² = 0.542). Both income stability (B = 0.308, β = 0.331, p < 0.001) and financial behaviour (B = 0.557, β = 0.578, p < 0.001) exerted positive and statistically significant effects on loan repayment culture. Financial behaviour produced the larger standardised effect, indicating that how borrowers manage available income is more proximately consequential for repayment culture than the structural stability of the income stream itself. The study concludes that loan repayment culture among Kwara microfinance clients is jointly shaped by structural income conditions and financial management discipline, with both dimensions requiring direct institutional attention. Microfinance banks should calibrate loan repayment schedules to borrower cash-flow realities and embed structured financial management support, covering budgeting, precautionary saving, and debt monitoring, into their lending processes.