This research aimed to look into the potential and utility of microfinance and how it might change financial institutions and society at large. The study mainly depends on findings obtained from 400 respondents who utilized the MFI’s services and 50 respondents from the employees of MFI’s from four cities in M.P. On the basis of the factors identified, different hypotheses were formulated and were tested through series of validated tests and procedures. Analysis of Variance (ANOVA) was performed to analyze difference among the mean values of more than two groups concerning the respective variables. The study found that the MFI’s have contributed to a great extent in fulfilling the needs of the poor. They have done this by administering their financial services such as the provision of saving accounts, insurance funds and credit to the poor and low-income class to help them increase their income, thereby improving their living standards. This report recommends that MFIs move toward digitization using smart cards. This report urges MFIs to diversify their financial offerings, such as their deposit options.
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