Bridging the Gap in Financial Inclusion and Empowering Small Businesses: Evidence from North-East India

Abstract

This study aims to investigate the significant impact of microcredit on small businesses and entrepreneurs in north-east India. The research employed a primary survey approach, gathering responses from 205 small business owners through purposive sampling. The analysis utilised a probit model to assess the data, highlighting that factors such as the business’s status, participation in awareness programmes by entrepreneurs, operating the business from home and other relevant variables play a crucial role in determining access to microcredit. The findings point out that the businesses experiencing decline are more likely to access credit from microfinance institutions. Also, there is a significant correlation between awareness programmes attended by the entrepreneurs and access to microfinance services. These findings suggest that an increase in the awareness programme participation by entrepreneurs will significantly encourage access to microfinance services.