The Samurdhi Programme, a major poverty alleviation programme of the Government, use micro-finance strategy under the Samurdhi Bank Unions which was implemented from 1996 onwards. This study has been carried out in Kalutara, Kurunegala, Batticaloa, Auradhapura, Ratnapura, Vavuniya and Jaffna Districts with the objective of performance evaluation of the Samurdhi Banks and to identify issues and difficulties faced by both the beneficiaries and officers related to the service delivery. It has been revealed in the report that around 20% of the Bank customers are non-beneficiaries. Of the total customers 12.8% have been former Samurdhi recipients. However, only 41% had returned their subsidy due to improvement of family income. The report also highlights some of the drawbacks in the Bank programme and one such major weakness has been highlighted as the poor targeting of the beneficiaries. The document also gives suggestions towards a more efficient and effective system of delivery.