Impact assessment of Microcredit on borrower’s life in rural areas of Bangladesh

Abstract

The microcredit program has created a revolutionary change in financial services. The main goal of microcredit to assist poor people to alleviate poverty through microcredit to be expected to invest in productive activities. Hence, to assess the effectiveness of microcredit is essential to reveal the actual scenario of the impact of microcredit on borrower’s life. This paper is presented as a qualitative approach to assessing the impact of microcredit in borrower’s life classifying the borrowers into four groups based on their income relative to their weekly installment and the degree of their investment of microcredit loan. A neutral assessment of microcredit reveals the positive impacts as well as some negative impact on the borrower’s life. It is observed that each group of microcredit receivers is not benefited in the same manner. Borrowers’ financial stability and tendency to investment play a major role to differentiate the impact of microcredit on their life.