THEORETICAL ANALYSIS OF MICROFINANCE ON POVERTY ALLEVIATION

Abstract

The objective of this paper is to investigate theoretical background of microfinance and poverty alleviation. The article consist the two types of theories, which related to microfinance. First types of theories addresses the specific issues the poor have to face when seeking access to formal financial resources, due to the lack of collateral and second types of theories. The second set of theories are based on the impact of microfinance on small businesses, households and individuals. The first category of theories consist Theory relating to Emergence of Microfinance, Concept of Joint Liability Group in Microfinance. Theories of impact pathway of microfinance consist Theory on Shortcomings of Development Finance Strategies, Market and Welfare Theories, Poverty Lending Approach, Financial System Approach and5 Financial Integrated Approach