The challenge of reducing poverty and improving living conditions for the poorest population is a formidable one. The betterment of poor people requires an effort that spans all sectors of the economy and may not be easy to achieve through economic growth alone. Financial services enable poor people to use profitable business opportunities and raise earnings.The prevailing operation of the formal or conventional financial institutions in many low-income countries such as Ethiopia is inefficient in providing sustainable credit facilities to the poor. Therefore, targeting credit to the poor is found to be one of the many instruments for poverty reduction. The book presents all topics in relation to microfinance and poverty alleviation in attractive and interesting ways.It helps to build up the knowledge /skills and attitudes of people towards the effect of microfinace on living standards , empowerment and poverty reduction.