IMPACT OF MICROFINANCE OF DEBT TRAP OF RURAL POOR IN SRI LANKA

Microfinance, a widely regarded instrument for poverty alleviation around the world, has been employed in Sri Lanka for decades. Despite the country's lengthy history and huge number of organizations providing microfinance services, little is known about the influence of microfinance on poverty alleviation in Sri Lanka. It is a well-known fact now that due to this limited knowledge of microfinance has been surpassed and rural poor has been negatively affected by the debt trap. Although microfinance programs have been enforced with the aim of uplifting the living norms of the poor, their negative impact has increased nearly. But while the positive impact of microfinance can be seen in numerous studies, there seems to be little studies on the negative impact of microfinance on the poor, similar as debt trap. This study seeks to give an overview of microfinance and the problem of debt trapping.