Effectiveness of Microfinance Schemes in Poverty Alleviation in Select Districts of Eastern Uttar Pradesh

Abstract

Microfinance is an effective tool for reducing poverty thereby improving their r socio-economic conditions. Further it is found that SHGs, direct mode of generation of microfinance are the important modes of the microfinance. The present study attempts to study the effectiveness of Microfinance schemes in reducing poverty in these regions. Self-Help Group (SHGs) is an important instrument for microfinance for the poor living in these regions. The maximum respondents are reporting that they are using this microfinance for starting new occupation and some other respondents reported that they started new occupation and purchased animals, social functions, agriculture, etc. With this microfinance farmers can easily purchase seeds, fertilizers, irrigation facility, animals and social functions such as marriage can be performed because money obtained from the NRLM, MUDRA and MSY scheme which are available throughout the year within the credit limits. This study provides a clue that out of all mode of availing the microfinance, microfinance through SHG is more efficient and preferred by most of the respondents. Further it is also noticeable that microfinance through SHGs develops a tendency of savings among its members and it provides an opportunity to work in a group which further developed the social bonding among them. The application of mean, standard deviation ,ANOVA and regression was applied to analyse the effectiveness of Microfinance scheme . The analysis of data indicates that t microfinance schemes in the area under study are playing better role in poverty alleviation in Shravasti and Behraich Districts of Uttar Pradesh.