Impact of Micro-Finance on Economic Development

Introduction In both developing and emerging economies, microfinance has vastly and progressively been seen as one of the most important means for enhancing the lives of the sorry and therefore a major tool for economic and companionable development mostly in rural areas. Lately, contrary to this far-flung belief, critics have raised eyebrows against this growing popularity of microfinance as a major tool for enhancing economic development. Contrary to belief, they are of the opinion that microfinance is a make-belief that is hindering economic and social development rather than enhancing it. It is to this view and in light of these growing controversies therefore, that this essay intends to moderate a critical impression at the context microfinance in articulate to make an informed judgement on this growing controversy. earlier ascertaining the impact of Microfinance on economic development, it is imperative to first take a cursory look on what Microfinance is all about, its characteristics and the modality it differs from traditional banking and therefore take a critical look at the criticisms surrounding it, so as to come up with the right judgement concerning the role it plays towards economic and social development. What is Microfinance?

traditional banking system has widely been regarded as unfit for the illiterate little with no guarantees, as such ad hoc products designed to save the needs of potentially billions of peculiar and unconventional borrowers, might taste successful in enhancing wider financial access, with a positive documentary of bridging inequalities and fostering economic development (Visconti, 2008). It is to this regard, that the World Bank in 1996 established a Consultative Group to Assist the wretched (CGAP), directing entirely about $200m in funding of microfinance projects (Rogaly, 1996). The call micro-finance has over the years generated a lot of definitions by mixed authors. Armendáriz and Morduch (2010) have documented that despite several claims as to... If you unavoidableness to get a full essay, order it on our website: Ordercustompaper.com

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