FINANCIAL INCLUSION: AN OVERVIEW OF MICRO FINANCE INSTITUTIONS IN INDIA

Abstract

In a developing nation like India, micro-finance is viewed as a helpful instrument for socioeconomic improvement. It is anticipated to have a big impact on development and reducing poverty. The purpose of the current research is to examine the effectiveness and contribution of microfinance institutions to India's growth. The survey found that there are many MFIs using bank loans. In India, there are many different types of financial institutions working in the microfinance sector, including NBFC-MFIs, Banks, Small Finance Banks (SFBs), NBFCs, and Others (including Non-profit MFIs). The RBI has started a number of initiatives in India to promote broader financial inclusion, including enabling no-frills accounts and GCCs for modest deposits and credit. The SHG-Bank Linkage Model and the MFI-Bank Linkage Model, two microfinance models, are studied in this study together with the combined data acquired from the banks and a preliminary analysis of the different trends and advancements within the microfinance institutions. The study looks at the development of financial inclusion in India, the country's current situation, the gaps that still need to be filled, and the changes the current administration has implemented to strengthen the country's rural economy.