Madan Shrestha – Role of financial institutions is excessive to build nation. Nepal is one of the least developed countries in the world and poorest within South Asia. The rate of poverty decline is very low. Considering the reason for this slow development could be less per capita income, and urban focused growth. Microfinance could help to the needy one who is willing to work but does not have upper opportunity. Mostly the bank & others financial institution are functioning in the field of urban area as the motive of profit.
Microfinance is appeared as the financial services focused to the marginalized or deprived community and small entrepreneurs to way them in self-employed. The branch of financial institution is extending day to day aggressively but the people of rural areas are not getting financial services with effortlessly. Micro-finance leads to social and economic changes to the deprived community and their upgradedlivings with the increase in income. Micro-finance can play effective role in poverty decline and people of exposedto empowerment. However, micro-finance is not a clarification in itself and many more other issues are also requirement to address.
Micro focused to reduce poverty and to facilitate micro credit to the beleaguered groups. It is the highest challenge in the sector of financial coverage. The coverage of financial analysis in Province no 6 & 7 are not satisfactory in the comparison to others. People of marginalized sector are not receiving the financial services as their requirement through formal financial organization. As the result most of the people who are in deprived sector are suppressed to loan from the local SahuMahajan with high charge of interest to fulfill their day to day need. So therefore, micro finance is the major component to support those people who are fighting against the poverty.
In the field of deprived sector people are not educate so that they do not know the skill of income generating. They are functioning out of education. Their expenditure goes in the unproductive sector. They are completely unknown the income & expenditure management. They do not have an idea of income generating, fundraising, saving and economic. These people offer the loan from the formal & informal channel exceeding amount to their need. So therefore financial literacy program is most to be launched to support them how to income generate, saving, fundraising, proper utilization of saving, proper way of investment, payment of loan in proper way, minimization of risk, importance of insurance and remittance etc. Therefore, microfinance is a mainstay which plays a vital role to close the relationship between each & others in the field of local communities. It helps to upgrade & uplift the skill & capacity of the people providing the various awareness programs in the society.
Almost financial institution insisted to conduct the literacy awareness program to empower & enrich the people. Laghubitta activates the financial education program on the behalf of the excluded people. To sustain to the financial institution for a long period basic requirement is to be provided such as, road, electricity, internet service, security, social support by the government then remarkable outcome will come out. It is happening a great challenge & difficult to launch this program in remote area.
To support to build the nation almost financial activist run aggressively being unified along with government. Microfinance services have been able to create self-employment opportunities and have been economically and socially empowered through increased income earning from their systematic task.
Central Government has declared that the approach of financial institution has to be outreached in the total number of 753 gaunpalikas. It helps to build capacity & create opportunity and get easiness to survival.
Microfinance services to accomplish the national objective of increasingly dropping poverty through upholding capital formation and producing self-employment opportunities. It has a positive impressionon poverty reduction. It delivered easy entrance to financial services for the poor to commence income generation activities. Such programs have also empowered the poor to better address helplessness and take further threats, as they are made carefully more enabled through succeeding loans and skill improving drills. (Ex Deputy Director of Agricultural Development Bank Ltd)