Financial Inclusion-Microfinance-Current Scenario, It's Crisis and Aftermath

The paper traces on the study of microfinance in India with special emphasis on the crisis it faced, though it has all the potentiality of developing as a sector of great importance after the crisis. It is always a matter of thought regarding the viability of microfinance institutions (MFIs).

Microfinance expected to play a very significant role in poverty alleviation and development. But the increasing number of suicide due to the pressure of repayment raised the question of viability to the world. As we know, there are two main approaches that the microfinance sector in India based on is Self-Help Groups (SHGs)-Bank Linkage Programme and MFIs. In India, microfinance is dominated mainly by SHGs-Bank Linkage Programme focused at providing a cost effective financial services to the unreached poor along with the MFIs. In this paper, we will try to analyse the reason behind the failure of the MFIs and its recent developments.