Critically assess the role of microfinance in satisfactorily addressing the interconnected challenges of poverty and unemployment.

Microfinance is the method of giving small amount of finance as a loan for various purposes. Poverty → Poor education, Poor skills or no skill, Unemployment Vicious cycle of Poverty and Unemployment Role of microfinance :- 1) Improving capacity - small loan as per capacity of individual help it come out of vicious cycle 2) Running capacity of loan of individual can be assessed and loans should be given 3) Small amounts to large beneficiaries

Limitations of microfinance :- 1) Identification of beneficiaries, huge task, which is difficult, successful, success 2) Risk defaults - in case of individuals, not paying back the money 3) Requirement of loans - of large amount to make meaningful changes in life to make them financially self-dependent 4) Frauds like SHG fund scan reducing the credibility of microfinance, also microfinance can satisfactorily tackle challenge of Poverty and Unemployment, group, providing certain from aid conditions are fulfilled

— Abhishek O. · AIR 336