The Impact of Microfinance on Poverty Alleviation

Abstract

Microfinance aims to offer financial services to individuals and small businesses that do not have access to conventional banking or related facilities. It holds the potential of enabling individuals, especially those in developing countries, elevate out of poverty by providing them with credit opportunities, savings accounts as well as other essential financial proceeding means for starting up new enterprises, creating employment registrations while simultaneously upgrading their standard living. Furthermore, Microfinance targets lowincome earners that are often sidelined from formal banking systems. High operating costs and a lack of security are two of the main obstacles banks must overcome in order to lend money to the underprivileged. Due to these restrictions, microfinance emerged in India as a substitute for traditional lending methods, aimed at promoting equality and financial inclusion for those who are poor