Relevance of microfinancing in India: an overview

Micro financing has emerged as a significant and well recognized buzzword in the today's financing environment. The basic objectives of micro finance are developing the financial forecasting and continuous saving practices among the large numbers of people in India especially in the rural areas. There is growth potentials for the growth of micro financing in India due to more than two third population of India belongs to rural area and whereas only one third population has bank deposits. The newly elected NDA govt. come with an innovative idea of connecting people especially from rural and remote areas with banking industry by launching PRADHAN MANTRI JAN DHAN YOJANA. the vision of govt. is economic liberalization and opportunities of development and growth of India with the help of micro financing. The challenge, there for is to link the large number of people with the banking industry in India by way of cost effectiveness, sustainability and growth at a micro level.