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Microfinance plays a significant role in the economic empowerment of women. Despite its positive impacts on improving the women’s basic needs, microfinance has generally fallen short of bringing about changes in strategic gender needs and gender relations at the household level. The main objective of the study was to assess the role of microfinance in the economic empowerment of women In Assosa town.Mixed design involving both quantitative and qualitative approach was employed so as to collect extensive data and confirm findings from different data sources through different data instruments. The source of necessary information to conduct the study was primary and secondary data sources.Descriptive method was used to analyze the data collected through questionnaire and interview.Since no action was taken by the microfinance institution with respect to women’s participation in domestic and community services, their engagement in business activities intensifies the already excessive workloads. Through the provision of loans to women, particularly to the poor, uneducated and who are not able to fulfill the collateral requirements laid down by other lending institutions, microfinance enables them to be self-employed. Consequently, some of the women have managed to increase their incomes, although in small amounts, and improve savings.In addition, their situation is exacerbated due to the fact that they receive no assistance from the husband in carrying out the domestic activities. In conclusion, the delivery of microfinance had positive impacts in the economic empowerment of the clients, although the income increases were small. Participation in microfinance has also enhanced the women’s self-esteem and enabled them to realize their potentials to engage in business and improve the household which is positive sigh of empowerment. The study result indicates that the delivery of microfinance had positive impacts in the economic empowerment of the clients, although the income increases were small. Microfinance institutions should train or educate women before giving them loans. This will reduce wastage of funds due to poor management.
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