Algebra of microfinance: Policy perspectives

Rural credit markets have been at the center of the policy intervention in developing countries over the past sixty years. Many governments supplying cheap credit to farmers and poor people, but these interventions failed, because policy makers have inadequate understanding of the working of rural credit markets. Microfinance institutions working on group based and joint liability. Through group, they solved the problem of monitoring, screening and enforcement. But, still, there are some obstacles present in rural credit market, which do slow the process of reaching the finance to the extremely poor person.