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1. Background of the Study

Microfinance has a very important role to play in development according to
proponents of microfinance. Microfinance plays three key roles in development. It
helps very poor households meet basic needs and protects against risks, it is
associated with improvements in household economic welfare, helps to empower
women by supporting women’s economic participation and so promotes gender
equity.
Microfinance creates access to productive capital for the poor, which together with
human capital, addressed through education and training, and social capital, achieved
through local organization building, enables people to move out of poverty. By
providing material capital to a poor person, their sense of dignity is strengthened and
this can help to empower the person to participate in the economy and society.
The aim of microfinance according to Otero (1999) is not just about providing capital
to the poor to combat poverty on an individual level, it also has a role at an
institutional level. It seeks to create institutions that deliver financial services to the
poor, who are continuously ignored by the formal banking sector.

Microfinance involves the provision of financial services such as savings, loans and
insurance to poor people living in both urban and rural settings who are unable to
obtain such services from the formal financial sector. Financial sector is one of the
burning and perplexing issues in the current arena. It is inseparable issues of the
society in other word it is one of the fundamental aspect of the sociology as well.
Society cannot be progress without the development of the financial activities.
Production and its related activities give the spirit of the society.
The educated as well as energetic women do not want to limit their lives in the four
walls of the house. They demand equal respect from their partners. However, Women
have to go a long way to achieve equal rights and position because traditions are deep
rooted in Nepalese society where the sociological set up has been a male dominated
one. Women are considered as weaker sex and always made to depend on men folk in
their family and outside, throughout their life. The Nepalese culture made them only
subordinates and executors of the decisions made by other male members, in the basic
family structure. While at least half the brainpower on earth belongs to women,
women remain perhaps the world ‘s most underutilized resource. Despite all the social
hurdles, Nepal is brimming with the success stories of women. They stand tall from
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the rest of the crowd and are applauded for their achievements in their respective
field.
The most underprivileged class like women is to be especially targeted to effectively
achieve overall poverty reduction in the country. Beni is developing in Myagdi having
a large number of co-operatives and women saving groups. These women groups are
created by women themselves under various government non-government
organizations. They collect money from all members & deposit the money in finance
companies or banks. They use the collected money as lending with low interest rate
without service charge in between the group members once at one member. They are
facilitated by the various programs held by the government and non-government
organization as well. Such as bakery, handicraft, anchoring, personality development,
interaction programs, account keeping etc. those programs benefits to women
financially. They are not more capable to take decision in household sector especially
in financial sector as well as their personal life too. They are not able to fulfill their
own needs and their children’s small needs without taking financial support of their
family specially their husbands. Due to this situation of micro-finance, this research
will trying to analyze its impact on female empowerment, which effect on economic
status of family and status of women in society. So, this topic and area will be
important to analyze impact of micro finance on social development of Dhaulagari
Microfinance of Beni Municipality – 8, Myagdi.
2. Statement of the Problem

Women of Nepal are poorest then men because they lack access to health, education
and economic resources. Most of the women of Nepal are involved in agriculture but
not recognized as farmer due to triple burden of work. Majority of women in Nepal
are suffering from hard work and have difficult social and economic condition. The
most unprivileged class like women is to be especially targeted to effectively achieve
overall poverty reduction in the country.
Different type of programs is lunching in women development in Nepal. Such as
priority sector credit program (PSCP), Small Farmer Development Program (SFDP),
Integrated Rural Development Program (IRDP), PCRW, Participatory District
Development Program (PDDP) which in fact are intended to uplift the rural poor,
especially women. Govt. also conducted micro credit project for women (MCPW) in
twelve districts and five urban areas.
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Presently there appear to be very limited number of MFLs attaining financial viability
and reaching sizable number of poor household at the same time. Reaching the
poorest and attaining financial sustainability is still dilemma for the Nepalese MFLs.
In this backdrop, the issues the emerge are: what microfinance efforts, policies and
programs have been followed in Nepal to alleviate poverty? Are the MFLs sustainable
and viable in the long run? (Sharma, 2011).
Although Myagdi is one of educational district of Nepal, women of this district are
still involved within household activities. They involve in agricultural activities. The
ownership right over the family properties rests with males not the females.
Some common problems related to women such as not owning land and low level of
education, limited scope to generate income and low social status are interconnected
and circular in nature. They are less conscious to save money and financial
mobilization. It is difficult for women to get high amount of loan without collateral
and with less collateral. It is difficult for them to invest in business activities.
Women microfinance in Nepal has been facing many problems. So this study is tried
to solve the following research problem within Dhaulagari Microfinance of Beni
Municipality – 8, Myagdi.
1. What is the saving habit of member women?
2. What are the sources of income of women respondents?
3. What is the loan use practice of member women?
4. What are the impacts of micro finance to improve in economic status of
the member women?

3. Objectives of the Study

The general objective of the study is to assess the impact of microfinance on women
in Dhaulagari Microfinance of Beni Municipality – 8, Myagdi. Other specific
objectives are as follows:
1. To analyze the saving habit of member women.
2. To study the source of income of women respondents.
3. To analyze the loan use practice of member women.
4. To analyze the impact of micro finance to improve in economic status of
the member women.
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4. Conceptual Framework

Review of literature has provided the sources for the identification of theoritical
foundation, different parameters are taken into consideration according to need of the
various objectives.
Following conceptual framework has been operationalized in this study.

Independent Variables

 Saving habit of member

Independent Variables
women Dependent
 Quality of the
Fig. 1.Conceptual
 Source ofFramework:
income of Variables
Product
women respondents Role of  Time
Microfinance on
 Cooperative Policy Women  Hard work
Empowerment  Market
 loan use practice of
member women

Saving habit of member women, source of income of women respondents,

cooperative policy and loan use practice of member women are dependent variable.
Quality of the product, time, hard work and market are independent variable of role of
microfinance on women empowerment

5. Significance of the Study

Every research itself has own importance because it aims to gain knowledge and to
add new literature to existing field. This study has great significance because
microfinance program definitely enhances the economic status of rural poor,
disadvantaged and deprived women of a society. The main reason behind this
research work is to analyze the impact of microfinance on women. So this study is
also important to get answer of above problems. Microfinance concept is very
important to poor Nepalese people especially for women. From microfinance tools
they can directly involve in fund raising program and can develop themselves. Today
many research studies have been carried out in many developed countries including
India, Bangladesh in microfinance. So, to the best knowledge of the researcher, it will
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be more significant in Nepalese context. In the light of above statements, the

researcher believes that the study will explore a virgin field in Nepalese women’s
microfinance scenario and add new things to the literature of micro finance sector. It
will also contribute scholars, teacher, decision maker, financial planner and other
training providers.
To date, Nepal about three decades of experience in Micro-Finance, which has been
exclusively recognized as a poverty-reduction program focused towards raising the
Income level and social standard of the people living in poverty, particularly women.
This research is to examine the impact of the microfinance on livelihood improvement
of the people living in Beni through employee opportunity, income level,
consumption expenditure, capital expenditure and social information.

6 Limitations of the Study

While this study is sheds light on various aspects of the micro finance. Furthermore,
this study attempts to contribute to a fuller picture of the micro-finance sector and its
impact. Followings are major limitation of the study
This study is only concentrated to Dhaulagari Microfinance of Beni Municipality – 8,
Myagdi
 . So it does not cover the real scenario of Nepal.
 The small part of the data in this study will be secondary; therefore the
comprehensibility and accuracy of the figure and information published in
this document may be bias.
 Research will be conducted in very short period of time.
 The sample size of this study is too small which may not represent the whole
population.

7. Review of Literature
Chakraborty and Jayamani (2013) published an article on 'Impact of Micro Finance
on Women Empowerment' Microfinance, a poverty alleviation tool to mitigate the
vulnerability of the people of the weaker section in the society, has widely been
implementing all over the world by engaging especially, the women in the main
stream economic development. From the conducted study suggests that microfinance
has been able to make poor women psychologically empowered and has raised their
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consciousness level high. It is also found that now they are equally capable of
executing their decision- making power in the family matters. From the table of
consciousness level of the beneficiaries, it is evident that the consciousness level
regarding exercising voting right, preparing oral saline and drinking tube well water is
satisfactory while the habit of using contraceptive is little bit low. Thus for the overall
development of the country including rural sector, the weaker section women must be
included as the key force with the existing male dominated financial sectors and all
the development program must be addressed to the financially backward women.

Sujatha and Malyadri (2015) published an article on Impact of Microfinance on

Women Empowerment: An Empirical Evidence from Andhra Pradesh. Empowering
women is the main social objective of microfinance programs. It is difficult to
evaluate the effectiveness of microfinance program on women empowerment because
measurement of women empowerment is a difficult task. In most of the studies
women empowerment is measured as latent variable. This study also measures
women empowerment as latent variable. Microfinance is a powerful tool in enhancing
women empowerment for its all indicators like household economic decision making,
economic security, family decision making, mobility and legal awareness. Only
participation in microfinance program does not lead to increase in women
empowerment but when it is coupled with participation in seminars, workshops and
training then it helps women in enhancing their empowerment. These training
programs not only provide self-employment training but also facilitate good decision-
making. All the indicators which have been used to measure women empowerment in
this study are not further studied for which indicators are more important in enhancing
women empowerment. Future studies may target on this issue. This study is
conducted in only one state of India. It opens the door to conduct similar studies in
other states of India and in other countries to reflect impact of culture diversity on
women empowerment. Demographic variables are considered controlled variables for
this study but they have important role in explaining women empowerment.
Therefore, future researches should consider role of demographic variables while
explaining women empowerment.

Nepal, et. al (2013) published an article on 'On Micro finance' best Practices Separate
regulating and supervising departments exist in NRB as well as competent and
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experienced staffs are assigned in these departments.New and qualified staffs are
being recruited in a regular basis by NRB.Frequent trainings, seminars and knowledge
sharing programs and similar activities take place for NRB staffs regarding regulation
and supervision of FIs. Adequate legal provisions with international standards are
already there and time to time revisions and amendments are undertaking for effective
regulation and supervision. Priorities and incentives are being provided for MFIs
going to remote areas. Microfinance has been accepted as an 'effective tool' of poverty
reduction by the government in its official documents and government time to time
unveils different policies for the development of this sector.NRB and government are
working together for the promotion of microfinancing in Nepal. Establishment of
Rural Self-reliance Fund, conduct of different projects, strengthening of the legal
provisions and structural developments are some of the major activities where NRB
and government are working together. 'Deprived Sector Lending Provisions' has been
reinstated for BFIs by the NRB. It was phased-out some years back.MFIs are also
involved in socio-economic activities under credit-plus program, which includes basic
education, entrepreneurship trainings, sanitation, women empowerment, etc. MFIs are
mostly concentrated in urban and accessible areas and less presence in hilly and
remote areas.We find multiple financing of MFIs and duplication of lending in most
of the accessible/pro-urban areas. Due to this, high drop-out rates are being observed
in those areas. There is duplication among the donors even in rendering microfinance
services. Comparatively high interest rates are charged by MFIs mainly due to their
higher operational costs.
Poudel and Pokharel (2017) study on Women’s Empowerment Through Small
Farmers’ Cooperatives: A Case Study from Eastern Nepal. SFCL has positive impact
on women empowerment; first in economic sense and consequently socio-cultural
dimensions. Since SFCL delivers services primarily targeting people to acquire
economic strength. This could be stepping-stone to enter in empowering socio-
economic perspectives. In addition of economic support, SFCL delivers services to
women to uplift socio-cultural standard. Service delivery system of SFCL does not
directly support to encourage women in political activities, though it implies in
political sense. It has emphasized women for microcredit programs in material
resources and their control over it. In addition of economic aspects, role of SFCL is
significantly higher in socio-cultural empowerment than the political empowerment.
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SFCL being an independent and non-political organization, people do not discuss in

political issues, but indirectly women become aware on their political rights. The
statistical analysis of t-test also shows the significant difference in socio-cultural and
political empowerment of women after involvement in it.
Wijerathne and Tharanga (2022) research entitled Impact of microfinance on women’s
empowerment during the COVID-19 pandemic. The results of the study showed that
microfinance had a favorable effect on women's empowerment during the COVID-19
pandemic. Therefore, it can be concluded that micro-credit, microsavings, and
training have had a significant positive impact on women's empowerment during the
COVID-19 pandemic period, while micro-insurance was identified as not a significant
variable. The primary contribution of this study was to fill the gap in the literature due
to the minimum amount of research on the effects of microfinance on women’s
empowerment during the COVID-19 pandemic period in the Sri Lankan context.
Additionally, this study can be used as a resource for all female entrepreneurs for the
successful management and expansion of their businesses. Microfinance institutions
can be used to create necessary facilities for the development of women's
entrepreneurship and to maintain that infrastructure so that such businesses can
survive and grow. Hence, these findings ought to be helpful for microfinance
institutions as they rank their service offerings and reorganize their operations in light
of the COVID-19 pandemic's results. The research study was, however, constrained
by the sample's restrictions, access and time constraints, primary data collection,
wider coverage, and political conditions. On the other hand, by taking these
restrictions into account, future researchers will have the opportunity to conduct
similar research in numerous locations, focusing on different business areas. It is also
possible to compare pre-and post-pandemic conditions in the same research study to
determine the type and extent of microfinance's impact on women's empowerment.
Other external variables can also be incorporated into the model, such as
infrastructure, knowledge, and education, which also might have an impact on the
empowerment of women.
From the above review of articles and dissertations it seems that this research paper is
trying to find out something new in the field of women microfinance. This research
paper is different from others in the case that is trying to find out the impact of
microfinance on women of role of microfinance on women empowerment: a study of
Dhaulagari Microfinance of Beni Municipality – 8, Myagdi. This research is trying to
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discuss about impact in case of saving activities, loan activities, loan disbursement
and its recovery as well as investment and income. It is also trying to discuss about
different profile of respondents. This paper is trying to discuss on the poorest of the
poor women's financial condition.

8. Research Methodology
8.1 Research Design
A research design is a plan for the collection and analysis of data. It is an organized
approach and not a collection of loose, unrelated parts. The research design serves
instruments to be utilized and the sampling plan to be followed. It presents resides of
guide posts to enable to researcher to progress in the right direction in order to
achieve goal. The design may be a specific presentation of the various steps in the
research process. The steps include the selection of a research problem, formulation of
hypothesis, conceptual clarity, and methodology, survey of literature and
documentation, bibliography, data collection, testing of hypothesis, interpretation,
presentation and report writing.
To conduct this studies analytical and descriptive approach will be adopted.
Analytical approach will be utilized mainly to analyze the relationship between
income, investment and other variables. Descriptive approach will be used mainly for
conceptualization of the research objectives and research problem of the study.

8.2 Population and Sample

Population refers to the entire group of peoples, events or things of interest that the
researcher wishes to investigate. A sample is a collection of items or elements from a
population. Hence, a sample is only a portion of subset of the population. It comprises
some observation selected from the population. The whole groups of cooperatives and
women saving Groups with in study areas are considered as the size of the population.
This study covers some sample women members for the purpose of study because of
the limitation of area, budget and time. Only 101 women will be selected out of 505
members of Dhaulagari Microfinance of Beni Municipality – 8, Myagdi as sample for
this study using simple random sampling method.
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8.3 Nature and Source of Data

This study will be mainly based on primary data. These primary data will be both
qualitative as well as quantitative. Secondary data will be used in this study will be
collected from different sources such as:
- Various research studies, dissertation and article related to the study.
- Annual reports from municipality.
8.4 Data Collection and Processing Procedure

This study basically will be based on primary data. Primary data will be collected
from the different primary data collection techniques.
(a) Primary Data:
Primary data will be collected from actual field using:
- Questionnaire:
Questionnaire will be used to get qualitative information. But some important
quantitative information is also collected the respondents of questionnaire
survey are the sample numbers and group managers of the program.
- Field Observation:
In this technique direct observation on field will be done. Women’s condition
about economy and other facilities is considered.
(b) Secondary Data:
Secondary data will be collected from reports of municipality, Journals of
microfinance, published books, unpublished books, thesis, and newspaper and
other related published journals and article.

8.5 Data Analysis Tools and Techniques

The available data will be edited, classified and tabulated in appropriate form.
Processing of data will be done by the computer using Microsoft excel.
Analysis is the careful study of available facts so that one can understand and draw
conclusion on the basis of established principles and sound logic. Various analysis
tools are used. The following techniques will be followed in analyzing the data:
- Collection of relevant information.
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- Identification of data suited to fulfill the purpose of the study.

- Classification and tabulation of data.
- Use of percentage charges, average, ratios.
- Drive conclusion, summary and recommendations will be based on the
analyzed data.
Some statistical tools such as mean are used. Mean is the central value on an average.
A simple arithmetic mean is determined by dividing the sum of values by number of
the observations.
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REFERENCES
Otero. M. (1999). The aim of microfinance Banijya Sansar, 11: 50-56.
Sharma, P. R. (2011). Impact of Microfinance on Women Empowerment, Team
Organizing Local Institution (TOLI), Pokhara.

Sujatha, Gangadhar, C.H. and Malyadri, P. (2015). Impact of Microfinance on

Women Empowerment: An Empirical Evidence from Andhra Pradesh. J
Entrepren Organiz Manag 4: 141.

Chakraborty, C. R. and Jayamani (2013). 'Impact of Micro Finance on Women

Empowerment' Journal of Economic & Finance, New Delhi: V, 2,1, 28-34
www.iosrjournals.org www.iosrjournals.org 28 Kathmandu: Institutie for
Integrated Development Studies (IIDS).
Nepal, R., Paudyal, A., Dahal, R. H., Adhikari, M. P., & Pokhrel, S. (2013).
SAARCFINANCE Seminar on Micro finance. Kathmandu: Ratna Publication.
Nepal.” Kathmandu: Pragyan .
Poudel, G. & Pokharel, B. (2017). Women’s Empowerment Through Small Farmers’
Cooperatives: A Case Study from Eastern Nepal Journal of Advanced
Academic Research (JAAR).
Wijerathne, B.G.D.N.D. and Tharanga, B.B. (2022). Impact of microfinance on
women’s empowerment during the COVID-19 pandemic, 5th Annual Research
Symposium in Management, file:///C:/Users/User/ Downloads /EXAbstract
22022.pdf