Can MFIs Eradicate Poverty from India?
Though the question is very simple, its answer is quite complex. Poverty in India is rising at an alarming rate.
Lack of education has lead to unemployment and that in turn has invited extreme poverty. With the introduction
of microfinance by the MFIs, the poor section of the society is now able to get funding for business and other
money-earning activities. Along with economic support, the organisations are also offering them a scope of
education. Thus saying MFIs only help in setting up business will be completely wrong. Apart from setting
business, they also help to educate people by conducting fast-track training session to build a skilled and wellequipped
workforce. Moreover, with new start-up businesses, more employment possibilities will emerge. As
people will get employed and start earning, the poverty ratio will come down slowly. So, it can be said that
MFIs can play a very big role in eradicating not only poverty but making people self-sufficient economically.
The microfinance institutions have paved the ground for the under-banked section of India to change their
financial status and take themselves up to the high societal pedestals. You can take a loan from these
organisations without any security for a certain time-period. Since these institutions don’t set any stringent
eligibility criteria for the borrower’s people can take loans whenever they feel the need without any inhibitions.
The only thing that the institutions lay focus on is that the borrower must be from the low-income group and the
money is taken for income-generation purposes. Hence, if you are facing issues while getting loans for setting
up business due to your bad economic condition, opting for microloans from the MFIs is a feasible and
beneficial option.
Though the question is very simple, its answer is quite complex. Poverty in India is rising at an alarming rate.
Lack of education has lead to unemployment and that in turn has invited extreme poverty. With the introduction
of microfinance by the MFIs, the poor section of the society is now able to get funding for business and other
money-earning activities. Along with economic support, the organisations are also offering them a scope of
education. Thus saying MFIs only help in setting up business will be completely wrong. Apart from setting
business, they also help to educate people by conducting fast-track training session to build a skilled and wellequipped
workforce. Moreover, with new start-up businesses, more employment possibilities will emerge. As
people will get employed and start earning, the poverty ratio will come down slowly. So, it can be said that
MFIs can play a very big role in eradicating not only poverty but making people self-sufficient economically.
The microfinance institutions have paved the ground for the under-banked section of India to change their
financial status and take themselves up to the high societal pedestals. You can take a loan from these
organisations without any security for a certain time-period. Since these institutions don’t set any stringent
eligibility criteria for the borrower’s people can take loans whenever they feel the need without any inhibitions.
The only thing that the institutions lay focus on is that the borrower must be from the low-income group and the
money is taken for income-generation purposes. Hence, if you are facing issues while getting loans for setting
up business due to your bad economic condition, opting for microloans from the MFIs is a feasible and
beneficial option.
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