India, Jan. 31 -- Over the past two decades, microfinance has emerged as a strong, robust, and sustainable means to transform the poor into self-employed mini-entrepreneurs. It has especially empowered the rural women. However, over the years, the segment has gone through periods of intense challenges, which include frauds, manipulations, double-lending, and loans to non-beneficiaries. The Economic Survey (2025-26) presents a new version of the old problem. It admits that the microfinance sector experienced a reversal in growth in FY-2025, and the outstanding loans declined by an alarming 14 per cent on a year-on-year basis. It explains that the stress was largely due to credit overexposure, which followed a rise in the pent-up demand aft...