The idea of microfinance somewhat strictly rolls around the philosophy of Muhammad Yunus of Bangladesh (Nobel laureate) who initiated organization poorest of the poor into self-help groups namely Bangladesh Grameen Bank (BGB) in the year 1976, and make them realize the basic “theory of survival”. It began in 1976, with lending of $ 27 to 42 poor people in a village next to the university campus where he was teaching economics. He had no intention of making a wave he was planning to create a bank for the poor. He had a modest goal. He was trying to free 42 people from the clutches of moneylenders by giving them the money, owed to the moneylenders, in order to repay them and become free from exploitation. However, the world-wide awareness and importance of microfinance for the upliftment of the poor has been growing over the years as different countries are attempting to device ways and means to enhance the access of the poor to credit facilities. As a result, an intense debate has erupted among the planners, bankers and officials of the government and non-government organization as to how financial services can be provided to the poor in an effective, efficient and sustainable manner. Finally the attempt and the idea has been praised worldwide and the interest reached a new peak with a micro-credit summit held in February 1997 in Washington which was considered the first step of a decade-long campaign that seeks to ensure delivery of credit for self employment by 2005 to hundred million of the world’s poorest families especially women of those families. In this paper problems and prospects of micro finance is discussed.

Keywords: Micro Finance, Financial Services, BGB, Self-Help Groups.