Poverty Reduction through Microfinance Assistance by Banks in Rural Areas -An Analytical study

Abstract

In developing country like India where approximately 400 million people living below or close to the poverty line, could be roughly translated into 75 million household out of which around 60 million are rural household. So poverty in India has predominantly a rural character. Micro finance has emerged as a needful programme to cater to the needs of the most under privileged people i.e., tribal, Dalits and Women. Micro finance is expected to play a pivotal role in poverty eradication and employment generation. In the present study Emphasis is to be given to analyse the nature of the micro finance activities under taken by the banks, role of banking institutions in rendering micro credit services to the poor people. Efficiency of micro finance provided by the banks and also identifies level of customer satisfaction about micro credit offered by the banks. Further, it concludes that. the most important form of micro finance is credit targeted to poor people who are also talented entrepreneurs. If these people gain access to credit, they will expand their business, stimulate local economic growth. These banks will be able to support their client’s efforts to control family risks as well as capitalize on business opportunities. They will offer savings, insurance, remittance services and personal and business loans, to help clients grow their assets while increasing their incomes. The goal of growth and poverty alleviation is now well recognized, so the micro finance is a very good platform for ensuring this by optimizing use of the financial resources and generate the employment potentiality.