Financial Inclusion – Micro Credit – Risk Management

Abstract

Financial inclusion could be an important instrument for alleviation of poverty. Financial Inclusion would result in economic growth and lead to balanced development. Financial inclusion broadens the resource base of the financial system by developing a culture of savings among large segment of rural population and plays its own role in the process of economic development. Policy transmission of the central bank could be most effective only when the entire financial system is under the organized sector. Financial Inclusion would ensure that vulnerable sections of the society are not exploited by the usurious money. Micro credit is an important aspect of financial inclusion and provision of which would lead to efficient allocation of capital and uplift the downtrodden from poverty. MFIs which are engaged in this onerous task have to guard themselves against risk undertaken.