Answer to Question #256280 in Economics for Deema

Question

13) What is microfinance, and what are its potential and limitations for reducing poverty and spurring grassroots development?

Answer 1

Microfinance, also called microcredit​, is a type of banking service provided to unemployed or low-income individuals or groups who otherwise would have no other access to financial services.

Microfinance helps to reduce the poverty and it is based on productive employment creation. Sometimes people see microfinance as the illusion for some poor's and villages but microfinance always provided the financial services, target the rural poor's, improve economy and society.