Abstract
Microfinance institutions (MFIs) in Tamil Nadu play a vital role in promoting financial inclusion and economic empowerment among marginalized communities. However, the psychological factors influencing clients' financial behavior and decision-making processes remain understudied. This research aims to explore the psychological perspectives on MFIs in Tamil Nadu, examining the cognitive, social, and emotional factors that shape clients' interactions with microfinance services. By applying theories from psychology, including cognitive biases, social identity, self-efficacy, and financial stress, this study seeks to provide a comprehensive understanding of the psychological dynamics at play. The findings will inform the development of tailored financial products, services, and interventions that address the unique needs and challenges of MFI clients in Tamil Nadu, ultimately enhancing their financial well-being and empowerment.
Keywords: Micro finance institutions, psychological factor, social identify, psychological dynamics.
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