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The potential of community fundraising in the villages through microfinance is actually very large, the through of institution of informal and semi-formal microfinance that is managed by the community itself, such as: credit unions, womens microfinance groups, grameen banks and “arisan” or “jula-jula” (the local tradition of micrifinance). The influence of microfinance so far is still limited to help the community in overcoming the risk of relative vulnerability level and small business activity in the scale is still very limited. Claims on the success of the microfinance program as a model of village development and helping the poor from the poorest are not proven. The position of microfinance has not been able to speak much; its influence is still very small in the rural development proces t in the village. Management of the microfinance institutions is still limited to small groups that are separate and have not been able to be assembled into a larger and stronger group at the village level with a wide range. Keywords— microfinance, rural development process, empowerment.

THE ROLE OF MICROFINANCE IN THE RURAL DEVELOPMENT PROCESS; CASE STUDY OF TANDEM HILIR II VILLAGE, HAMPARAN PERAK SUB DISTRICT, DISTRICT OF DELI SERDANG