Which institution mainly provides financial assistance and support to microfinance institutions in India?

Correct option is D

The correct answer is (d) Small Industries Development Bank of India (SIDBI).
· Small Industries Development Bank of India (SIDBI) was established in 1990 and is the principal financial institution for the promotion, financing, and development of the Micro, Small, and Medium Enterprises (MSME) sector in India.
· SIDBI provides refinance support, loans, and financial assistance to various microfinance institutions, enabling them to extend credit to small entrepreneurs and businesses.
· It plays a critical role in capacity building, facilitating access to finance, and providing an ecosystem that supports the growth of microfinance institutions.
· Department of Economic Affairs (DEA) operates under the Ministry of Finance and is responsible for formulating and monitoring the country's economic policies, including fiscal policies.