BY VENKATESH.N

KOSHYS INSTITUTE OF MANAGEMENT STUDIES

Effectiveness of Micro-Finance on Living Standards and Empowerment

in Rural Bangalore

Micro- Finance - Meaning

Microfinance is usually understood to entail the provision of financial services to micro-entrepreneurs and small businesses, which lack access to banking and related services due to the high transaction costs associated and Lack of Educational support and Knowledge.

Characteristics of Micro-finance

Little amounts of loans and savings.Short- terms loan (usually up to the term of

one year).Payment schedules attribute frequent

installments (or frequent deposits).Installments made up from both principal

and interest, which amortized in course of time.

And the Like

Microfinance Products and Services

Micro-loans

Micro-savings

Micro-Insurance

Products Offered By Bharitya Swamuktha Samsthe 

Fortnightly General Loan (FGL)

Fortnightly Supplementary Loan (FSL)

Re-Build Loan (RBL)

Weekly General Loan (WGL)

Monthly General Loan (MGL)

Statement of the Problem

“To study effectiveness of microfinance on living

standards and empowerment in rural Bangalore.” This

study is done to understand how micro-financing is

helping rural people by providing them with employment

opportunities and helping them to improve their living

standards. This study will add to the knowledge about

effectiveness of rural micro-financing in Bangalore.

Hence the present study.

Objectives of the Study

To study how microfinance works in India, with a special reference to the rural Bangalore.

To study how microfinance helps in improving the standard of living of rural persons.

To study the how microfinance effects the empowerment of rural persons using analysis of Income, Savings and the like.

Research Methodology

Method of Research UsedExploratory Study

Collection of DataPrimary DataSecondary Data

Sample Size50 Respondents

Major Findings

70% of the respondents of MFIs are women and majority of

them have no formal education, social freedom and

independency.

Micro Finance is very popular source of income when compared

with other sources of finance

The procedures of obtaining loans from MFIs are much easier

than other sources of finance.

The operational assistance provided by MFIs helps the

respondents to run their business successfully and smoothly.

Major Suggestions

It is suggested that women should be given more significance to start up

their own business, to become self dependent and social freedom.

Micro finance is more popular in rural Bangalore and it is appreciated it is

suggested that MFIs should share the best practices which they have

incorporated in their day to day activities.

It is appreciated that MFIs are providing hassle free loans and the status of

these should be continued to extend their base also to urban sector.

Conclusion

To conclude, it can be noticed from the overall study that there is significant impact of microfinance activities on improvement of the living standard of the family not only in economic term but also in social term of people living in rural areas of Bangalore. The relation between different factors of society and family became evident and clear, which were being neglected and not thought about during the period of existence of only conventional banking system. From this study it has come to the conclusions that there is a noticeable and positive impact of microfinance activities on the living standards, empowerment of people in rural areas around Bangalore city.

Thank You

Any Questions