Abstract:
This research study outline an important sector under the domain of banking which is micro-
financing that is stated to be a growing sector in the developing country of Pakistan. This sector
has the potential to contribute to the economy of the country greatly by enhancing the economic
and social aspects of the nation of the country by providing means of a progressing future by
providing finance to the potential ventures to the lower income group in parallel to the higher
income group which is being served by the existing commercial banks. This paper attempts to
highlight the potential challenges faced by this sector in Pakistan including inefficient
regulations, competition, need of diverse and innovative product and services in micro finance
and at the same time reduce the poverty level in the country. Then it takes a look on the
opportunities which are evident that there are many developing countries like Bangladesh
benefiting from micro financing and with a proper and effective platform and structure, micro
financing is the next potentially beneficial sector in Pakistan.
