Trust – an Essential Element & Pillar of Micro Finance

Micro Finance is blend of social & economic issues. Stakeholders of Micro Finance requires strong trust bond among each other. Micro Entrepreneurs save money for their future requirements and bank on person who he feels may be helpful when need arises in future. Micro Entrepreneurs also trust their peers and lend them with an anticipation of similar treatment when peers have surplus. The suplment fund of micro financing comes from NGOs, government, banks etc. and they work in each others coordination. Donors also expect prudent use of their fund. The whole micro financing require special level of trust among each other. The paper discusses related issues on the basis of Indian experience, ‘trust’ as pillar of Micro Finance, and suggest ways how the bond of trust can still be made stronger.

Download full paper from SSRN:


Keywords: MICRO FINANCE, socio-economic development, trust
JEL Classification: Q13, D00

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