Poverty vs Development
Genre: General Awareness

Discuss various programs used to alleviate poverty in developing countries. How effective have they been?

About the Book

Poverty vs Development

One of the key grassroots movements across developing countries have been focussed around helping the under privileged, uneducated rural population earn a livelihood while becoming financially independent. There have been many organizations who have been working for the same in countries like India, Africa, South East Asia and other countries.

One of the key concepts of decreasing poverty has been microcredit. Microcredit is a process wherein a financial institution or an NGO gives out small, micro loans to individuals or groups in rural areas so as to enable them to become entrepreneurs (Yunus, 2008). The basic idea of microfinance started with the need to replace the loan sharks who took undue advantage of rural people by issuing loans which the borrowers could never repay. The borrowers cannot approach the bigger banks due to lack of collateral and credit history Micro finance has enabled rural folks, women in particular to take small loans in groups from micro lenders and use it buy seeds for agriculture, fertilizers etc. This has helped them work within a small amount initially and do agriculture and other business on their own. The idea behind using groups is that if one member of the group fails to repay the loan, it reflects on the financing potential of the entire group. Thus, it motivates individual members to work better to repay the loans so that fresh ones could be issues to them immediately for further expansion of the business.

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