Socioeconomic Impacts of Microfinance Programs in the Development of Bangladesh

Rezaul Karim

doi:10.46281/asfbr.v1i1.1

Rezaul Karim Department of Business Administration, Atish Dipankar University of Science and Technology, Dhaka, Bangladesh

DOI: https://doi.org/10.46281/asfbr.v1i1.1

Keywords: GDP, NGO, MPC, Microfinance, Socioeconomic Impact.

Abstract

The study was conducted to find out what significant socioeconomic impact and how microfinance programs play the key role on the development of Bangladesh. To observe that we tried to find out in which way it is playing its role and what kind of socioeconomic impacts are related with microeconomic programs. Microfinance programs are providing a significant role in the development of Bangladesh by providing financial assistance to the lower income but self-employed people. They have turned into employed by getting the financial support from the different institutions especially from Grameen Bank, BRAC etc. The poverty level has minimized a lot from the rural area and household income increase by around one-third. Wages and marginal propensity to consumption (MPC) increased especially for women and it creates positive impact on children's schooling: A 1.05% increase in Grameen Bank female borrowers increases the probability of school enrollment by 1.8% for girls and 1.99% for boys. Microfinance also contributed to smoothening consumption level and reducing vulnerability of life of people. It plays a role in eradicating poverty, promoting education, improving health and empowering women.

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