Exams › SSC CGL (Prelims) › GK

What is the definition of microfinance?

1. A microfinance institution is a company registered under the Companies Act, 1956, and engaged in the business of loans and advances and acquisition of shares, stocks, bonds, debentures, or securities issued by the government.
2. Microfinance is a banking service provided to unemployed or low-income individuals or groups, who otherwise would have no other access to financial services.
3. A microfinance institution is a digital-only and mobile-first bank.
4. Microfinance refers to providing banking services to individuals living in rural areas.

Correct answer: Microfinance is a banking service provided to unemployed or low-income individuals or groups, who otherwise would have no other access to financial services.

Solution

Microfinance refers to financial services such as small loans, savings, and insurance offered to low-income people who lack access to conventional banking. It is meant to promote financial inclusion. Therefore, the second option is correct.

Related SSC CGL (Prelims) GK questions

• What is the economic justification for subsidies in the agriculture sector?
• Which of the following best describes the difference between SHGs and MFIs?
• Which type of unemployment is found in India when people are employed for a certain period of the year in tourist resorts and various tourism-related activities in the mountain regions, but are unemployed in the off-season?
• Gangubai Hangal belonged to the ________.
• The first Indian woman to hold the Under-20 World Wrestling Championship is _________.
• Which part of the Indian Constitution deals with the election of the Vice President?

⚔️ Practice SSC CGL (Prelims) GK free + battle 1v1 →