STUDY ON THE BORROWERS PERCEPTION ON THE ROLE OF MICROFINANCE TOWARDS THEIR FINANCIAL DEVELOPMENT

Microfinance model becomes imperative in transforming the lives of poor households. Access to credit by low income or poor households plays an important role in improving their income level. Indian microfinance sector has witnessed phenomenal growth over past two decades that as on 30th September 2021, the number of MFIs has reached to 194 and it is operating in 29 states, 5 union territories and 591 districts in India. On an average, 3.52 crore households have availed the credit through MFIs up to 2021. Southern region has an average market share of 39% of overall MFI contribution. Microfinance facility is extended by the Small finance banks, NBFCs through SHGs and JLGs. Subsequent cycle of JLG loans enable the clients to maintain their businesses of such as purchasing inputs, securing the stocks, replacing or repairing the equipments. Timely access to follow up loans provides an experience of steady improvement in the economic and financial conditions. This study aims to analyse the expectation and experience of MFI clients in selected districts of Tamilnadu towards the impact of MFI loans in their financial improvement. The findings of the study highlights that the major expectations of MFI clients are increasing the loan amount and support for skill development and training program for self employment. Many studies acknowledged micro credit positively impacted the social and economic development. The findings of the study add to this evidence and it also highlights that amount of MFI loans and subsequent loan cycle have directly impacted the financial improvement of MFI clients. Keywords: Micro-credit, SHG, JLG, Poverty, Insurance and Financial Inclusion