Four questions that are raised in this paper are: (1) Why is it necessary to reserve formal credit for rural poor? (2) Is credit a constraint on increasing production and incomes of the rural poor? (3) Is existing credit delivery conducive to increasing their incomes? And (4) What improvements are required to make this delivery more effective in increasing their income? Answers to these questions are proposed by abstracting out the real-world experiences in India. Wherever possible empirical support is also given.