Social and Economic Impact of Microfinance on Urban Poor Women: An Empirical Study of Ahmedabad City (India)

Abstract

Microfinance is considered as a tool to improve the living standard on the social and economic terms. The objective of present study is to find the social and economic Impacts of microfinance on the poor urban Women in Ahmedabad city. 384 women respondents have been selected using the judgmental sampling method. The study uses theoretical and empirical literature to propose a framework to improve women’s living standard through micro-financing. Exploratory factor analysis was done on the 20 statements. Three factors were extracted from factor analysis, namely Development in Personality, Enhancement in Monthly income, spending and saving and enhanced the decision making ability. Multiple regression was performed and found Enhancement in Monthly expenditure, income and saving as a significant factor in up gradation of the social and economic status of Women. Paired t-test was done to check the improvement in the economic level of Women after joining the SHG where the result revealed positive impact. Overall, it was found that microfinance activities have a positive influence on the social and economic status of urban poor Women. The study has practical implication that it can be used to improve the living standard of the poor women. Further, the microfinance is a tool to reduce the poverty level and improve the purchasing power of poor.