Social Exclusion, Poverty and Microfinance

In Social Sciences literature there is general agreement on the core features of social exclusion, its principles indicators, and the way it relates to poverty and inequality. Social exclusion is the denial of equal opportunities imposed by certain groups of society up on others which leads to inability of an individual to participate in the basic political, economic and social functioning of the society. Two defining characteristics of exclusion are particularly relevant, namely, the deprivation caused through exclusion (or denial of equal opportunity) in multiples spheres –showing its multidimensionality. Second feature is that, it is embedded in the societal relations, and societal institutions - the process through which individuals or groups are wholly or partially excluded from full participation in the society in which they live. It recognizes the diverse ways in which social exclusion can cause deprivation and poverty. Consequences of exclusion thus, depend crucially on the functioning of social institutions, and the degree to which they are exclusionary and discriminatory in their consequences. Social exclusion has sizable impact on an individual's access to equal opportunity if social interactions occurs between groups in power/subordinate relationship. The groups focus thus recognized the importance of social relations in the analysis of poverty and inequality.

This paper attempts to address two interrelated issues. First it tries to conceptualize the nature and dimensions of the “Social Exclusion” in Indian society and secondly its implications for poverty of excluded groups. This paper also finds that would be microfinance one of the best reliable instruments for struggling of these conditions. Researcher has taken help of NSSO, NABARD and National-International reports, researches and appropriate statistical tools for this paper.

This paper concluded that caste, gender, religion, diseases, migrant, ethnicity, income and poverty are big base of social exclusion and cyclical relation between these elements and social exclusion, both are intertwine. And microfinance plays a catalyst role in social inclusion through poverty eradication.