MICROFINANCE A NEW APPROACH TO ECONOMIC DEVELOPMENT

Assistance and support in the form of finances play an extremely important part in the development of the economy. The majority of the financial assistance comes from both unorganized and organized money lenders operating inside the financial system. The current situation in India is that financial institutions, such as banks and microfinance institutions, are the primary competitors in the market. As a result, they have the lion's share of the market share in their respective sectors when it comes to lending money. The establishment of microfinance institutions is done with the intention of fostering various financial activities in the community, most notably saving and credit. People living at or below the poverty line are the primary target audience for microfinance institutions. Through various microfinance programs, the microfinance organizations' primary goals are to integrate into mainstream society those individuals who are economically disadvantaged, socially isolated, and women. The purpose of this study is to investigate the role that microfinance plays in the socioeconomic development of rural communities and groups with incomes below the poverty line. The quantitative data served as the foundation for the investigation. This article takes the form of a perceptual study of the data that indicated microfinance's small contribution to the process of social transformation and development.