Impact of Microfinance on Rural Empowerment in Anuradhapura District

Abstract

Microfinance is the provision of a broad range of financial services such as deposits, credits, and payment services in order to empower the poor and low-income households and their microenterprises. This study examines the impact of microfinance on rural empowerment in the Anuradhapura district. The study is mainly based on the field survey conducted by the researcher. Both participants and non-participants with microfinance services are taken into consideration for a better understanding of the impact of microfinance. A structured questionnaire based on a five-point Likert Scale was used and it was able to collect data from 300 microfinance beneficiaries and another 200 people who are not engaged with microfinance services in the Anuradhapura district according to the convenience sampling method. As the sample of the study, the researcher gathered data from rural people who are living in the Divisional Secretariats; Nuwara Gampalatha East, Kahatagasdigiliya, Thirappane, Galenbindunuwewa, Horowpothana, Mihinthale, Ipalogama, and Kebithigollewa in the same district. The study measures the impact of microfinance on rural empowerment by using five determinants: micro-enterprises, education, health condition, decision making, and common welfare. Statistical Package of Social Science (SPSS) was used to analyze and interpret the data for the research findings. The study results indicated a positive significant impact of microfinance on rural empowerment. Furthermore, the study emphasizes that there is a significant role of microfinance in the empowerment of poor people.