Microfinance Activities and Factors Affecting the Growth of Microfinance in Developed & Developing Countries

Abstract

Microfinance Institutions (MFIs) have served millions of poor people around the world by offering them small loans with easy repayment terms. This review paper highlights the microfinance activities performed by the MFIs and also indicates the critical factors that hinder the growth of microfinance in developing and developed nations. It is found that the foremost factors obstructing the adoption of microfinance are: lack of financial stability, uncontrolled growth, cultural and value impede, systematic frauds, bureaucratic obstacles, state intervention, methodological defects, and shortage of credit rating agencies.