Credit for poor is used to be a laughable concept but however granting loan to poor for starting their own business has become popular tool for reducing poverty. Microfinance institutions grants loan to the poor so that they can start their business and improve their standard of living and reduce poverty.There are various factors responsible for poor credit recovery.The factors were the weak skills of the staff of microcredit institutions & their corrupt propensity and the borrower wrong attitude towards credit payment etc. There are other factors which are responsible for poor credit recovery are discussed in book in detail. Historical micro financing is more effective then the modern micro financing because older has opportunity to sustain.