Microfinance: Hope for Survival

Dr. Muhammad Yunus felt the need of the poor people and found that they need finance i.e. Micro-finance. So he  expanded financial services for the poor as a grassroots development strategy. Micro-finance which emphasis granting small loans to the poorest of the poor lacks of collateral. Poor people in developing countries typically have little access to formal financial services, but that they should possess some survival skills that make them credit-worthy. Credit programs can offer the poor access to small amounts  and in turn they use these loans for self-employment projects to generate income and eventually become self-reliant.

India’s economic growth has failed to make significant improvement in its poverty. In spite of various poverty alleviation programs by the government but failed to deliver the objective up to satisfaction level,   the reason may be many such as failure to reach the target group loopholes in the system, unable to develop an effective system . Many countries including India experimented with subsidized credit which only led to increase in the Nonperforming assets (NPAs).

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