Digital Transformation of Microfinance and Digitalization of Micro Financial Services in India

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Vagish Mishra

Abstract

Microfinance is one of the many fields in which digital technologies are fast making headway, and this trend is expected to continue in the foreseeable future. The continuous advancements that are being made in digital technology are helping to transform its operational models, governance structures, risk profile, industry networks, and popular practises. These shifts are being brought about as a result of the interaction of a number of different variables. Because of their capacity to foster growth, innovation and the incorporation of digital technology are both major factors in today's world. Innovation has the potential to advance development by enhancing productivity and expanding participation. Integration of digital technology has the potential to increase both productivity and accessibility. In this paper, we investigate how these three mechanisms – innovation, inclusion, and efficiency – have been fundamental to microfinance operations in the past, as well as how advancements in digital technology may present microfinance institutions with additional opportunities to further the cause of international development. In addition, we look at how microfinance institutions can take advantage of these opportunities to further the cause of international development. In order to investigate the ways in which developments in digital technology are influencing the microfinance industry, we will use several instances from the Indian microfinance industry.

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How to Cite
Vagish Mishra. (2024). Digital Transformation of Microfinance and Digitalization of Micro Financial Services in India. European Economic Letters (EEL), 14(1), 1019–1028. https://doi.org/10.52783/eel.v14i1.1120
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