Micro-finance and Rural Development: Exploring concepts, methods, and impacts (original) (raw)

Part I: Defining Micro-finance and understanding it implications on rural lives Over the course, the term 'microcredit' has shifted to 'microfinance' mainly to anticipate the broader aspect of financial ecosystem to serve the need of the poor through various financial services (Ledgerwood, Earne, & Nelson, 2013) such as microcredit loans, savings, and insurance (Newman, Schwarz, & Ahstrom, 2017). The transformation and commercialization of the microfinance concept has now integrated as a formal financial sector (Ledgerwood & White, 2006). According to Obaidullah (2008) microfinance is an appropriate stratagem to alleviate poverty. Nwankwo, et al. (2013) stated that microfinance is drawing greater attention as a solution to the "… crippling effects of the conventional banks interest on the poor …" Ledgerwood & White (2006) supported that the microfinance approach is the ideal method to accomplish the mobilization required to greatly expand exposure to financial resources for millions of low-income households worldwide.

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