Poverty is ostensibly a multi-dimensional issue. Economic, social and political forces play a role in its creation as well as its eradication. Financial inclusion, understood as the provision of micro-credit to populations that have never before had access to lending, has for some time been considered a useful way to help reduce poverty. In this paper, we have taken a two-pronged approach: (1) we tested the power of financial inclusion in influencing poverty outcomes, and (2) we identified those features in the microfinance institutions (MFIs) that closely determine the extent of financial inclusion. To this end, we gathered original data on financial inclusion in Peru for three years, 2008-2010, and employed a panel data analysis which concluded that financial inclusion has an alleviating effect on poverty and that larger MFIs – and those that target the poorer clients – tend to be more successful in enhancing financial inclusion
