Has Microfinance Stimulated Wellbeing in Pakistan?

Abstract

This study aimed to empirically calculate the impact of microfinance on wellbeing and poverty. This was done by taking a random sample of 182 borrowers, all of whom had taken microfinance loans from Khushhali Bank and conducting their structured interviews. Two indexes, one each for wellbeing and poverty were made, and progress of borrowers in terms of wellbeing and poverty was measured according to these indexes. Through logistic and linear regressions, it was concluded that almost all the variables studied had a positive relationship with wellbeing and poverty, as expected. In cross tabulation analysis, all variables showed results which were in line with the theoretical underpinnings of the model. A perception analysis showed that majority of the borrowers felt that they were able to access the loan very easily and felt that microfinance had led to an improvement in the overall economic condition of the household.