Microfinance and Poor: A Case Study of District Sangrur

Abstract

Microfinance has become a effective way to economically and socially empowering the poor in developing countries like India. This research paper finds the effectiveness of the microfinance policy adopted by Non government Organization Umeed Foundation, effectively working in district Sangrur, on rural poor households. In our research we tries to find out whether this policy has any effect on income, expenditure and savings of beneficiary household. Two blocks Bhawanigarh and Sangrur blocks were purposely selected where from 12 villages data was collected from 200 beneficiaries of 18 Self Help Groups. We used closed ended questionnaire and personally met the beneficiaries and discussed the questions in details. All the respondents from whom data were the members of Self Help groups formed under foundation. All the beneficiaries were women. Mostly these beneficiaries were illiterate and belonged to schedule cast. Beneficiaries borrowed under scheme to invest in productivities but only 80 percent did so. Repayment rate is very high in our research. T- Test is applied to statistically analyse the data. Research found that Umeed Foundation is very popular among the poor and there is positive impact of scheme on income, expenditure and savings of the beneficiary household.