Helping the poor with credit financing and bringing them out of their poverty-ridden status has been the goal of microfinance. It has seen many successful such stories in the last few decades since the inception of such a concept. Many have benefitted and are now successfully leading their life.
Microfinance was introduced to make the weaker sections financially independent and find their self-capability of how they can make a profitable living with very little financial help that can go a long way in their development. In order to support this, we need to know what the benefits that microfinance offers are. They are listed and detailed here:
1.Access: the first and foremost requirement in any type of credit will be the minimum eligibility in terms of cash or assets which has been the denial factor for many when they apply for loans with banks or other institutions. But in microfinance, it is not necessary to have any such previous holdings and people can directly claim the use of funds for their beginning of self-improvement. Thus access to reach the class of unprivileged is the main concern of this concept
2. Easier loan repayment rates: the case is that microfinance enables a large section of women to borrow such credit and establish a self-business and achieve success in their line. This is made possible because of the easier and cheap loan terms of interest as well as repayment policies. Hence it is very conducive to women empowerment and a safe form of investment for those who avail such credit.
3. Extending education: families which have been not in that financial status to educate their children are now happy that their kids also can go to school and live up to their dreams with microcredit facilities for education. Unlike all other plans, this is something which is very personal and heartwarming to the people when they are able to provide a better life for their children.
4. Improved health and welfare facilities: one of the crucial necessities of human life is health and daily amenities like clean water and surrounding to live in. This facility of micro financing has facilitated the access of improved health care aids and also better access to clean water and sanitation for the deployed areas which have been in a doomed state so far. This is one of the essential features of a happy and safe life.
5. Sustainability: the amount of help doesn’t matter when its results are really magnificent and bringing hope to many families in the world. A small amount can make a big change in many lives which have never seen or experienced happiness. Thus the sustainability is that which makes microfinance a successful financial derivative.
6. Job Creation: microfinance aids to create new employment opportunities and this has a benefit to the economy at large.
Hence, it is clear that Microfinance is a life-changer to our world.