Role of Microfinance in Agriculture Transformation in Nepal

Chandra Prasad Dhakal


The main purpose of this study is to analyze the roles of micro-credit in the transformation of agricultural occupation of local farmers residing in Tanahun, Kaski, and Syangja districts of Gandakai province, Nepal. It is assumed that micro-credit plays an important role in the improvement of the occupational status of farmers. In this context, this study aims to identify the effect of micro-finance in the agriculture sector. The study followed both qualitative and quantitative research methods and a descriptive and analytical research design. An analytical research design was used to analyze the quantitative data, and a descriptive research design was used to systematize the qualitative data collected from both primary and secondary sources. The result reveals that recipients of loans from micro-finance were found to benefit from higher income, household expenditure, savings, and saving mobilization. Similarly, the programs run by micro-finance help increase employment opportunities and economic activities around the concerned areas. It also helps to uplift the social status of the members, improving health status, increasing education, and enhancing the role of women in household activities. Conclusions of this study will support the improvement of microfinance-related policy in Nepal. This paper establishes the new value of research as a practical form in the field of the effectiveness of microfinance operations at the local level in the transformation of the agricultural sector.


Keywords: agriculture, farming, economic status, microfinance.



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