The Role of Microfinance in Poverty Alleviation and Economic Empowerment
Keywords:
Microfinance, Poverty Alleviation, Economic Empowerment, Financial Inclusion, Women Empowerment, Entrepreneurship.Abstract
Microfinance has emerged as an important development strategy aimed at reducing poverty and promoting economic empowerment among low-income populations. By providing access to financial services such as microcredit, savings, insurance, and financial literacy programs, microfinance institutions (MFIs) enable economically disadvantaged individuals to engage in productive activities and improve their livelihoods. This study examines the role of microfinance in poverty alleviation and economic empowerment through a review of secondary data and existing literature. The findings indicate that microfinance contributes to income generation, entrepreneurship development, women's empowerment, and financial inclusion. However, challenges such as high interest rates, over-indebtedness, and uneven impacts across regions remain significant concerns. The study concludes that microfinance can be an effective poverty reduction tool when combined with education, skill development, and supportive public policies.
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