Abstract: The purpose of the paper is to find out whether microfinance helps to reduce poverty and has impact on economic development at all. Microfinance has been established targeting the poor people who are screened out from getting loans from formal financial institutions due to lack of collateral and low creditworthiness. There has undergone a tremendous transformation in all aspects of microfinance, including outreach and portfolio size, proliferation of microfinance through a large number of microfinance institutions, diversification of services, new regulatory regime, contribution in rural development, recognition of microfinance as a major contributor in poverty reduction and so on. Even then some challenges concerning institutional efficiency, diversity of services, fallout from political and macroeconomic factor and replication of agricultural credit are faced. Microfinance is not a panacea at all but has limited impact on freeing the people from poverty and especially empowering the women in the society.
Keywords: Microfinance, Rural Development, Collateral, Poverty reduction, Non-financial services, Empowering women.
Title: Behind the Helping Hand of Microfinance: An Overview of Microfinance in Developing Countries
Author: Md. Monzur Hossain, Rashedul Islam, Sayeda Amin
International Journal of Management and Commerce Innovations
ISSN 2348-7585 (Online)
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