Role of microfinance in elevating the living standard of people

In this modern world of technology and machinery, being a poor person is a curse. It is very eccentric to note that on one side the human race has progressed by leaps and bound however, on the other side the number of humans living a disgusting life in poverty and deprivation has increased by manifolds. Not only this brings misery to the individual but it also forces them to participate in illegal and antisocial activities. Ethiopia is a new and emerging country amalgamated with vivid societies and economic classes. In order to diminish the economic gap between rich and poor the government is running many prestigious programs. The role of microfinance programs has been of paramount import for developing countries in eradicating poverty from their economies. This paper ponders on the role of providing financial assistance to the potential entrepreneur in the form of micro financing and its impact on reducing the financial disparity among the citizens of Ethiopia. In this research the researchers have infused statistical tools like factor analysis, KMO test, and descriptive statics. The study suggests that Micro financing has helped in reducing the financial stress and establishing small entrepreneurs. The study can help to increase the efficiency of microfinance providers as it evaluates the difficulties faced by them and put forwards suggestions to resolve the situation. The study also speaks of the socioeconomic status of the beneficiaries and what impact it has on the poverty elevation, expansion of the business organizations and increased employability in the study area. In the end of the research the future scope has been proposed as well.