The Role of Microfinance in Achieving SDG 1: No Poverty

Abstract

Microfinance has emerged as a critical tool in the global fight against poverty by providing low-income individuals access to essential financial services traditionally unavailable to them. This study explores the role of microfinance in achieving Sustainable Development Goal 1 (No Poverty), examining its impact on income generation, financial inclusion, and social welfare among marginalized populations. Through a mixed-methods approach combining quantitative data analysis and qualitative case studies, the research highlights how microfinance empowers vulnerable groups, particularly women, to improve livelihoods and build resilience against economic shocks. While findings indicate significant contributions of microfinance to poverty reduction, challenges such as high interest rates, limited outreach, and contextual constraints remain. The study concludes that microfinance, when integrated with supportive policies and social protection, can substantially advance poverty eradication efforts aligned with SDG 1 targets. Recommendations for enhancing the sustainability and inclusivity of microfinance programs are discussed.