Question

explain role of microfinance in poverty alleviation

Answer 1

MIcrofinance has played a key role in alleviating poverty by lending money to the most needy people of the society. It teaches them to survive by their own by giving them sufficient training and education. Large, National or Multinational banks lend money or give loans through a stringent process where in, the income statement and the collateral are a must.

On the other hand micro finance does not ask for collateral and gives loans starting from a very minimal amount. This makes the repayment easier and also helps the people to understand the trends in business, thus contributing majorly to alleviating poverty.