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What are the rationales for Microfinance Bank in an Economy?

The fundamental reasons for the establishment of Microfinance Banks in an economy are as follows:

  1. It is a poverty alleviation strategy.
  2. It assists the active poor in accumulating productive assets.
  3. It stimulates the savings culture.
  4. It helps the active poor to work their way out of perpetual poverty.
  5. It assists in general economic growth.