Role of microfinance in alleviating C-19 induced poverty

The pandemic induced shocks have wreaked havoc on vulnerable groups across the globe. The Covid-19 has hit not only the health sectors but also all players of the economy. It has pushed the approximately 3. 5 crore people into poverty line. Although the government has adopted a number of initiatives to tackle the economic downturn and maintain steady trend of poverty eradication, the shock induced by pandemic has reversed the steady trend of poverty reduction in Bangladesh. Is there any way to combat this situation? In this circumstances, microfinance can play a crucial role when it comes to poverty elimination. A tiny number of experts raise a question in terms of coming out of poverty using microfinance. However, it is an essential instrument to enhance socio-economic condition in developing countries, such as Bangladesh. Bangladesh has come a long way since its independence in terms of eradicating poverty. Once dubbed as a Bottomless Basket by former US secretary of state Henry Kissinger, Bangladesh is now among the most vibrant economies of the globe. In this case, NGOs have played a pivotal role for war affected people of Bangladesh in rehabilitation process and enhancement of socio-economic status. We know that NGOs started extensive activities to enhance socio-economic condition soon after independence. At present, NGOs has conducted multifaceted social development programs. Microfinance program– a small scale lending projects targeted at low-income groups--is one of them. NGOs operating in Bangladesh has provided worth 15000 taka to approximately 30 million poor, destitute and marginalized people to alleviate poverty. The vulnerable groups of the country borrowing small amount of money from different types of organization establish production related activities such as Poultry Farms, Dairy Farms, Small cottage industry, Fishery, Agricultural activities. These groups are tremendously benefited from microfinance; moreover, they are able to gain self-reliance. Apart from this, they create employment opportunity for other unemployed section, a fact that contributes to alleviate poverty, to a great extent, in a developing countries. It is worthwhile to mention that a significant number of the poor of our country fail to take a loan from Banks due to the lack of necessary documents and collateral. Albeit inevitably, this large segment of the people have hardly access to credit facility other than taking a loan from money lender at a high interest rates. Despite having myriad benefits of it, ambiguity and drawback remain still in these programs. A tiny segment of the experts believe that microfinance facility is mainly targeted at women, meaning that the worries of the daily income for the household needs and debt repayment fall overwhelmingly on the shoulder of women. The fact that when liability become unsustainable, many are forced to seek out debt bondage-labor as a means of paying off microfinance loan- in hazardous occupation hits the women’s present status, health and gives a rise mental distress for women. Apart from this, a plethora of humans raise a question as to its accountability. The government must sit with expert to accelerate the program and address the pit hole of this project towards alleviating poverty and enhancing socio-economic condition of the people living below the poverty line. The poor should exploit the optimum benefits of it by borrowing necessary amount from NGOs. Besides, Regulatory body of this program should go up surveillance so that the people are able to evade any negative impacts of it