GENERAL KNOWLEDGE

Detailed explanation-1: -Microcredit is a common form of microfinance that involves an extremely small loan given to an individual to help them become self-employed or grow a small business. These borrowers tend to be low-income individuals, especially from less developed countries (LDCs).

Detailed explanation-2: -How does microfinance help the poor? Experience shows that microfinance can help the poor to increase income, build viable businesses, and reduce their vulnerability to external shocks. It can also be a powerful instrument for self-empowerment by enabling the poor, especially women, to become economic agents of change.

Detailed explanation-3: -Microfinance solutions enable consumers to obtain loans when they most need it and increase credit availability. Banks rarely give customers small loans; MFIs that offer microloans fill this gap. By raising the amount of funds accessible to the poor, it enables capital growth.

Detailed explanation-4: -Microfinance, also called microcredit, is a type of banking service provided to unemployed or low-income individuals or groups who otherwise would have no other access to financial services. All the above functions-Credit, Savings, Insurance and Fund Transfer facilities are madde available under microfinance.

Detailed explanation-5: -Through microfinance institutions such as credit unions and some non-governmental organizations, poor people can obtain small loans, receive remittances from relatives working abroad, and safeguard their savings.