This paper examines the effect of urban microfinance on occupation and problems encountered by microfinance actions. The survey through a questionnaire is made on a total of 100 sample respondents locating in the outskirts and slum areas of Bengaluru urban. It is been found that urban microfinance has a statistically trivial positive impact on some income or expenditure variables. Urban microfinance is becoming popular since the urban poor like rural poor also wanted to gain the benefits of microfinance activities. Self Help Groups (SHGs) are deemed to be the most important tools in participation of approach for the socio-economic development of women. Several previous studies have been proved that SHs programmes fall under the type of schemes and savings of micro credit. It has been successful in shifting the life of underprivileged women through enhancement of income and self esteem (Rigin, 2014). It is been observed that there is been a greater association between the attributes under study.