Since the 1970s there has been a strongly growing interest in considering micro financing asrna viable strategy for the poor. Especially after the success of the Grameen Bank, the systemrnhas been duplicated in the different parts of the developing world. Ethiopia is also one of therncountries where micro finance has been given due consideration as a safety net for the poor tornhelp them overcome the adversities of poverty.rnMicrofinance institutions, as mentioned above, are basically set up with the goal of povertyrnreduction. Hence, the situation whether the objective of these MFls is met merits specialrnconsideration by way of impact assessment. Although several studies have been conducted sornfar, the impact of micro finance on poverty reduction still remains an issue to be addressed.rnThis study tries to answer three important questions: how well ACSI has been workingrnregarding repayment and outreach; what welfare difference ACSI has brought on the clientsrnand what opinion the clients have regarding the services provided by ACSl.rnWith the above objectives in mind, the research work employed questionnaires (developed byrnUNSAID's AIMS Project), key informants; focus group discussions, and observations tornobtain primary data. In addition, secondary sources of data have also been used. Eventually,rnusing a mix of qualitative and quantitative tools(such as logit model), the study found out thatrnACSI has brought positive impacts in income, consumption, asset building( in urban areas inrnparticular) and decision making in household activities. However, much is to be done inrnincorporating more females in the program and in devising strategies in such a way thatrnclients would look for other alternative income generating ventures, other than, for example,rn" ',. , 'Irnbuying ox and sheep in rural areas and cereals trading in urban areas of Enemay,Woreda. Inrnaddition, loan size ought to be considered in addition to providing the poor with trainingsrnand technical backup.rnKey Terms: Poverty, poverty reduction, microfinance, ACSI, impact, Enemay Woreda