Effects of Microfinance to Reduce Poverty: A Comparative Study of GO-NGO Collaborated and Non-collaborated Projects

Bangladesh faces an enormous challenge in reducing poverty. In every development plan in Bangladesh, the central focus is poverty reduction. However, it becomes difficult for the Government to act alone as it cannot command all the resources, personnel, administrative outreach, or expertise necessary to maintain progress in poverty alleviation. Microfinance Institutions, especially NGOs, have taken a key role in poverty alleviation efforts. They have been providing credit to these poor people who lack savings and capital but want jobs in the farm and non-farm sectors. In addition, the NGOs in Bangladesh, with their network, experience, and flexibility, have played a vital role within the existing policy environment governing civil society, particularly in addressing poverty. Therefore, poverty has become a grave concern for the Government, NGOs, and donor agencies. The NGOs, hand in hand with the Government, have been implementing a wide range of development activities to alleviate rural poverty and develop the country. This study attempts to identify and assess the critical issues in alleviating poverty by micro-financing GO-NGO collaborated projects and compare with those projects that are not collaborated to improve this situation by analyzing different NGOs and government practices. The collected data from various sources can conclude that government-NGO partnership projects work better than non-collaborated projects.