I just want confirmation that the micro usb connector charges the battery too.
RKidecha yes. The when connected, USB feeds the battery charger. Remember you shouldn't use a battery smaller than 300mAH with the nRF9160 Feather. (See the docs for details.)
could you please let us know why less than 300 mAh battery is not sufficient for nRF9160 Feather?
This is to take into account the charging current provided by the charger (Max current is 288mA during charging). Max discharge also plays a big role during LTE CAT-M operation. (Decent batteries can't supply more than 1.5C - 450mA for a 300mAH battery) I can't stop you from using another sized battery but I won't be able to support you if you do go outside my recommendation.