What is a Micro Finance Company Registration?

Micro finance companies are financial institutions that provide small loans to the poor, who typically cannot get a bank loan. Many micro finance companies were started because big banks would not provide loans to people with little or no collateral and low credit ratings. The first company of this type was Grameen Bank, which was created by Muhammad Yunus in Bangladesh in 1983. In many developing countries, such as Bangladesh, micro-finance companies have been successful because they were designed to help improve small businesses and agricultural production among the very poor citizens. The loan amount is often in the range of $150-500, which they use primarily towards education costs or other investment opportunities such as buying capital equipment for their business or farm. The interest rate can be 12% or even higher. There are basically 2 types of Micro Finance Company Registration that are allowed in India. North America has a few dozen Micro Finance Company Registration institutions that deal with loans of $500 and below, mostly targeting the poor in Third World countries. There are many ways to classify these financial companies, but typically a Micro Finance Company Registration purpose is to provide affordable loans for poor people in developing countries. The loan amount is usually small but the loan is usually over a long period of time and often becomes a long term savings program. The interest rate can be from 12% or more (which is high) but many are fixed at 8%.