Mostly in our rural areas credit is not available to the farmer on time or they can get it only on very high interest rate. So there is great potential of Micro Financing in Bahawalpur region. Many developing countries like Bangladesh, India, Sri Lanka and Pakistan are using microfinance to increase the living standard of their people. Rate of interest charged by these MFIs are very high and their main focus is on Agriculture sector only. There is a strong relationship between microfinance and poverty alleviation. The results also showed that Microfinance Scheme help people to improve their living standard and provide them financial opportunity to expand their business. Microfinance is the key strategy that leads to quick revival of economy, increase in living standards and empowerment. Living Standard is very important issue in all developing countries like Pakistan where one forth of population falls in the category of Poor. Govt. has estimated that about 23% population lived under poverty line. Mostly in our rural areas credit is not available to the farmer on time or they can get it only on very high interest rate. So there is great potential of Micro Financing in our region.