Mediating effect of social status between functioning of mfis and empowerment of beneficiaries

Abstract

Development of society becomes possible only when the economic and social status of people is developed and it leads to their empowerment. Microfinance is a mechanism of providing financial services to the targeted group who has been excluded by the formal banking services. Factors of the functioning of Microfinance Institutions have been considered in this study. The factors were extracted using Exploratory Factor analysis and the mediating effect of social status on the relationship between the functioning of MFIs and empowerment of beneficiaries was also checked. Both primary and secondary was used in this study. Primary data was collected with the help of prepared schedule from the beneficiaries of selected MFIs. Sampling has been done in multiple stages to collect data from 417 respondents. Result of the study shows that two factors namely group forming & monitoring and training & counselling were extracted from exploratory factor analysis. And, the social status of beneficiaries has a mediating effect on the relationship between the functioning of MFIs and the beneficiary’s empowerment. Various suggestions and policy implication were provided for the policymakers.