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Introduction 1.1 What is Microfinance? The concept of microfinance is not new. Various savings and credit groups which had operated in different countries since centuries include the "susus" of Ghana, "chit funds" in India, "tandas" in Mexico, "arisan" in Indonesia, "cheetu" in Sri Lanka, "tontines" in West Africa, and "pasanaku" in Bolivia. The concept of micro financing and self-employment activities in rural areas has developed considerably and it is working neither on domain / charity nor on subsidy. The emergence of informal financial institutions during 15th century in Nigeria who were the first to establish in Europe during the 18th century as a response to the enormous increase in poverty because of European wars during 1618 to 1648. In 1720 first loan fund targeting poor people was funded in Ireland by Jonathan Swift.