Micro-finance and its Impact on Poverty - 948 Words

Despite the growing body of literatures about the microfinance and its impact on poverty, there are counter growing criticisms against microfinance in issues such as reaching the poor, unchanged poverty level, high interest rate, brutality in repayment processes, financial sustainability, and women empowerment. (Hossain, 2010). In terms of poverty reduction and reaching the poor people, the studies edited by (Hulme Mosley, 1996) on the impact of microfinance on poverty found that poor people do not benefit from microfinance; it is only non-poor people who do well with microfinance and achieve positive impacts. (Morduch Haley , 2002) points out that studies that have been conducted to examine the microfinance targeting and impact†¦show more content†¦Another criticism of microfinance is the aggressive techniques that used by MFIs in collection practices. (Brix McKee, 2010) mention that because the aggressive techniques used by some MFIs, governments in India, Ghana, the Francophone West Africa region have issued regulations that prohibited the intimidation or coercion in collection practices. To promote appropriate collection practices, some development organization such as CGAP, SEEP developed client protection principles that help the MFIs to ensure the clients are treated fairly and responsibly and no brutality practices are used in the repayment processes. (Arteaga, Kapila, McAllister Porter, 2006) state many MFIs around the world applied these principles to improve their practices before donors and regulators force their standards on this industry. MFIs have generally targeted women as clients. Microfinance providers believe that accessing to microfinance services empower women and enable them to be more assertive and confident. (Littlefield, Murduch, Hashem, 2003) report the results of studies in Bolivia, Ghana, and Bangladesh indicate the women were significantly empowered and in the term of physical mobility, ownership and control of productive assets,Show MoreRelatedMicro Finance Loans : The United Nations Economic And Social Council1521 Words   |  7 Pagesbeen lent through Kiva, a popular crowdfunding website for micro-finance loans, since its founding in 2005. That same year, the United Nations Economic and Social Council declared 2005 the â€Å"Year of Microcredit† to emphasize the importance of providing financial services to the world’s poorest in an attempt to lift them out of poverty. The idea is simple: instead of donating to charities that provide some services to people in poverty, micro-credit o rganizations could just lend poor people the moneyRead MoreInvestigating the Role of Micro-Finance in Female Empowerment, Kawangware Division, Nairobi County1519 Words   |  7 Pages 1 INTRODUCTION 1.1 Background information Poverty is a universal phenomenon, that is found virtually everywhere and affect a large number of people in the globe. To this effect Thirlwall (2003:87) contributing to the poverty literature, says that ‘in poverty, there is feeling of powerlessness, vulnerability and fear because the poor is not free, he is exposed to greater risks and living on the margin of subsistence.’ That is to say, the poor have little or no significant say in theRead MoreThe Role and Impact of Microfinance Institutions on Ghana’s Economy.1472 Words   |  6 Pagesreading from page 71 under the heading of - Determining what to research, and stop at the 8 questions. , propose a research topic and Justify it choice. Proposed Research Topic: The Role and Impact of Microfinance Institutions on Ghana’s Economy. Topic Area: The topic is on Microfinance and the Impact It has on Ghana’s Economy. Microfinance is often defined as financial services for poor and low-income clients offered by different types of service providers. MicrofinanceRead MoreRole of Microfinance:- The micro credit of microfinance program was first initiated in the year600 Words   |  3 Pages Role of Microfinance:- The micro credit of microfinance program was first initiated in the year 1976 in Bangladesh with promise of providing credit to the poor without collateral , alleviating poverty and unleashing human creativity and endeavor of the poor people. Microfinance impact studies have demonstrated that : †¢ Microfinance helps poor households meet basic needs and protects them against risks. †¢ The use of financial services by low-income households leads to improvements in household economicRead MoreCan Micro Loans Help Reduce Poverty in Developing Countries? Essay1176 Words   |  5 PagesMicro Loans in Developing Countries: Can Micro Loans help in Reduce Poverty The word poverty came from the Anglo-Norman word povert. Poverty is predominantly seen in the developing nations. Poverty is a where people lack their basic capacity to participate effectively in society i.e. Not having enough money to provide food and clothes to their family, not being able to work and earn for themselves. There are many reasons for poverty in developing countries some of them include overpopulation,Read MoreAdmitting Education Institution : Admitting Educational Institution952 Words   |  4 Pageslow level increased of income. On the other head 14% respondent has respondent has replied highly Satisfied. (DSK Activity Report, 2015) My review And recommendation about DSK: Microfinance institutions have been viewed as an important tool in poverty alleviation. From some of the point are identified for respondent to disagree with the question. Those are an important point which would improve the living conditions of the poor and lead to the development of the country. Some of the issues areRead MoreUttar Pradesh and Tamil Nadu: A Comparative Study in Micro-Finance1699 Words   |  7 Pages Literature Review- Studies analyzing the Micro Financing in India- Micro finance has been a field which has attracted a lot of research work. A review of the major research works of economists and sociologists provide us with interesting insights on issues related to microfinance. Seibel and Parhusib (1990) in their study mentioned that expansion of credit coverage through state interventions approach was largely based on the premise that rural micro entrepreneur are unable to organize themselvesRead MoreThe History of Micro-Credit as a Means for Development of Poor Nations1632 Words   |  7 PagesThe Indian population lacks opportunities such as financial resources and the ability to get jobs. They are stuck in an endless cycle with no opportunities for people to lift themselves out of poverty. Microcredit has been used as a method by governments in developing countries, international funding organizations and donor agencies, in order to help the poor make money since the 1950’s. During the 1950s and1960s, the Indian government started disbursing loans to families in rural areas that workedRead MoreMalawi Financial Scoping Survey On Micro, Small, And Medium Enterprises Essay989 Words   |  4 PagesCHAPTER ONE: INTRODUCTION 1.1 Problem Background The Malawi financial scoping survey on micro, small, and medium enterprises (2012) shows that Malawi has close to 760, 000 small business owners generating annual revenue of about US$2billion, but 60 per cent of whom do not use financial services. The small business owners in Malawi are relatively young with an average age of 31 years, with 70 per cent of them having just primary education. The MSME sector creates employment for just over a millionRead MoreA Research On Micro Finance2042 Words   |  9 Pages EXECUTIVE SUMMARY Micro-finance is a service provided by banks and other financial institutions in which extremely affordable and easy loans are provided to the low-income segment of the country and those people having no source of financing. It is mostly practiced in under-developed and developing countries. Micro-finance ensures that these people have a secure income source for their future. Furthermore Micro-finance serves a dual purpose of: 1. Raising the Employment level 2. Increasing the