Paper short abstract:

In this study, we assess the effectiveness of the various social protection measures that a number of state and non-state actors took in order to mitigate the impact of the pandemic on microfinance borrowers.

Paper long abstract:

The exclusion of the poor from formal financial services has led to the evolution of an alternative mode of finance, microfinance, in which financial services are provided through non-traditional routes, such as microfinance institutions.

The COVID-19 pandemic brought untold misery to millions around the world. For those who were already struggling to make ends meet, this was a particularly bad time. Consequently, the Federal and Provincial governments reacted by rolling out a series of measures that offered social safety nets to the deserving poor. They offered cash disbursements of fixed sums and non-cash items such as food packages were distributed. The social protection measures were meant to protect and support those who had lost livelihoods as a consequence of the pandemic.

This study was conducted to assess if, how and to what extent the ensuing social protection measures taken by the state helped to mitigate the loss of earning of the rural poor. It also assesses how the various microfinance institutions responded by offering services of relief packages to their borrowers, as the outbreak resulted in the loss of income for micro-entrepreneurs in rural areas.