International Journal of Marketing & Financial Management
Print ISSN : 2349 –2546
Online ISSN : 2348 –3954
Frequency : Half Yearly
Current Issue : Volume 13 , Issue 2
2025
Ch Satish
Ch Satish, Lecturer in Commerce and Business Management, New science Degree and PG College, Hanamkonda, Telangana, India
DOI : https://doi.org/10.5281/zenodo.17761963 Page No : 14-23
Published Online : 2025-11-29
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ABSTRACT
Microfinance has emerged as a vital instrument for promoting rural empowerment and inclusive development in India. It provides small, collateral-free loans, savings facilities, micro-insurance, remittance services, and financial literacy support to low-income households traditionally excluded from formal banking. Through community-based models such as Self-Help Groups (SHGs), Joint Liability Groups (JLGs), and Microfinance Institutions (MFIs), microfinance has expanded significantly, enabling rural families to engage in income-generating activities, start micro-enterprises, and improve their overall economic stability. The study highlights the substantial role of microfinance in enhancing women’s empowerment, strengthening financial inclusion, reducing poverty, and
promoting social development. SHGs and MFIs have been particularly effective in increasing credit accessibility for marginalized groups, fostering savings discipline, and improving community participation. Despite its achievements, microfinance continues to face challenges such as low financial literacy, poor infrastructure, high operational costs, over-indebtedness, and regulatory constraints. This paper adopts a descriptive and analytical approach using secondary data to examine the impact, contributions, and challenges of microfinance in rural India. The findings underscore the transformative potential of microfinance in building a more inclusive, resilient, and empowered rural society.
Keywords: Microfinance, Rural Empowerment, Financial Inclusion, SHGs, Women Empowerment, Poverty Alleviation, MFIs, Rural Development
Type of paper: Research Paper
