By Microfinance Focus, on October 30th, 2009% Microfinance Focus, official Media Partner of “Microfinance India Summit 2009”, thanks all the participants in our opinion poll. This is a true reflection of the sector on the most debated issues. Your opinion provides a significant clue to gauge the trends in India`s Microfinance Sector.
Key Findings:-
57 % of respondents are not confident on Indian MFIs transparency level. 87 % respondent supported a uniform Microfinance regulation. 67 % respondent said commercialization causing mission shift. 61 % respondent said no to interest cap . . . → Read More: Microfinance Focus Opinion Poll : Result
By Microfinance Focus, on October 28th, 2009% Prakash Bakshi (Executive Director, NABARD)
Despite technological advance, we still depend heavily on rains for a good crop. There are ways around this: insurance and better irrigation. We are the largest global producer of certain crops, but our productivity is very low.
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 28, 2009: L&T Finance Ltd, the financial services subsidiary of Larsen and Toubro, is bullish on the microfinance sector. Having forayed into microfinance in 2008, the company plans to promote its microfinance initiatives across India. L&T Finance has a large equity base and raises debt on an on-going basis from banks and financial institutions. It recently closed a non-convertible debenture issue.
L&T Finance Vice-president Dinanath Dubhashi spoke to Priyanka Jayashankar on the sidelines of Microfinance India Summit . . . → Read More: No takeover plans for L&T Microfinance: Dubhashi
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 28, 2009: L&T Finance Ltd, the financial services subsidiary of Larsen and Toubro, is bullish on the microfinance sector. Having forayed into microfinance in 2008, the company plans to promote its microfinance initiatives across India. L&T Finance has a large equity base and raises debt on an on-going basis from banks and financial institutions. It recently closed a non-convertible debenture issue.
L&T Finance Vice-president Dinanath Dubhashi spoke to Priyanka Jayashankar on the sidelines of Microfinance India Summit . . . → Read More: No takeover plans for L&T Microfinance: Dubhashi
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 28, 2009: Agatha Sangma, Indian Minister of State for Rural Development, said on Wednesday that NREGA would soon transform from its current wage-based program to facilitate self-employment among the rural population.
Releasing the “State of India’s Livelihoods (SOIL) Report 2009″, the second in series prepared by ACCESS Development Services, the minister underscore the need for sustainable progress in rural sector. Ms Sangma, the youngest member of the Indian council of ministers, also pointed out the need for . . . → Read More: NREGA to focus on self-employment soon: Agatha Sangma
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 27, 2009: Will the business correspondent model work to bring the poor in remote areas of the country into the ambit of financial inclusion?
First, the experiment with the no-frills accounts which the country’s central bank RBI has pushed ahead faced failure. Now the BC model, which has the ability to serve the poor in rural and remote areas, has no inherent demerits but the implementation mechanism requires openness, according to speakers at the microfinance India Summit . . . → Read More: Will the business correspondent model work in India?
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: India’s microfinance icon Vijay Mahajan, who had just finished an arduous moderation of heated discussion at a session of the Microfinance India Summit 209 on Monday was in for a surprise when he entered the other room where the awards were to be announced. He was selected for the award for his lifetime contribution to the microfinance sector. The jury has also given a special award to late mentor Sitaram Rao for his contribution to . . . → Read More: Bandhan, Vijay Mahajan given Microfinance India Awards
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: African workers send home more than $40 billion to the region each year but restrictive laws and costly fees hamper the power of remittances to lift people out of poverty, according to a new report by the UN’s rural development agency, the International Fund for Agricultural Development (IFAD), stated a press release. Remittances are sources of income for poor families, particularly in Africa and the Latin American and Caribbean regions. With the majority of poor . . . → Read More: Remittances help microfinance survive: IFAD
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 25, 2009: What spurred Kolar’s large-scale delinquency? The question dominated the evening session of Microfinance India Summit being held in New Delhi on Monday.
While the day began with a pomphlet distributed by Ramesh Bellamkonda, Managing Director of BSS Microfinance Pvt. Ltd.. Teh pmphlet has pointed out that the delinquency problem in Karnataka was triggered by religious considerations and urged immediate attention of the microfinance community and regulators. Apparently, the local religious leaders have issued a decree . . . → Read More: Questions abound on Kolar delinquency incident at Microfinance India Summit 2009
By Microfinance Focus, on October 28th, 2009%
From Microfinance Focus in New Delhi
Oct. 26, 2009: Has the growing commercialization of microfinance institutions impacted the MFIs’ commitment to address alleviating poverty as their primary objective?
CS Ghosh: Irrespective of its impact, I believe that commercialization is necessary. An institution cannot become sustainable until it is commercialized. Subsidy can never give sustainability, it will only give dependence – all of us are aware of this, but tend to ignore this sometimes. In order to alleviate the . . . → Read More: Responsible Commercialization is necessary for microfinance : Bandhan chief
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: Releasing a study on Cooperative-owned or managed microfinance institutions in New Delhi on Monday, Princess Maxima,Special Advocate for Inclusive Finance for Development of UN Secretary-General Ban Ki-moon, sought to know the reasons behind the failure too, if any. The study by sector specialists Girija Srinivasan and N. Srinivasan on six microfinance institutions has examined and recommended suggestions to make COMFIs more successful. The study was based on six case studies of community owned institutions and . . . → Read More: Princess Maxima releases report on Community-Owned Microfinance Institutions in India
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: Speaking at a round-table on community-owned microfinance institutions as part of the Microfinance India Summit 2009 in New Delhi, Princess Maxima of the Netherlands and UN secretary-general’s special advocate on microfinance, had one direct question for the leaders of microfinance sector in India. “Are the cooperatives of SHG model affected by over-politicization?”
The first response came from Mr U.C. Sarangi, Chairman of NABARD, who explained that large scale state participation necessitated by funding from the . . . → Read More: Princess Maxima’s poser spurs discussion on cooperative/SHG model of Indian microfinance
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: Speaking at a round-table on community-owned microfinance institutions as part of the Microfinance India Summit 2009 in New Delhi, Princess Maxima of the Netherlands and UN secretary-general’s special advocate on microfinance, had one direct question for the leaders of microfinance sector in India. “Are the cooperatives of SHG model affected by over-politicization?”
The first response came from Mr U.C. Sarangi, Chairman of NABARD, who explained that large scale state participation necessitated by funding from the . . . → Read More: Princess Maxima’s poser spurs discussion on cooperative/SHG model of Indian microfinance
By Microfinance Focus, on October 28th, 2009% Microfinance Focus, Oct. 26, 2009: India’s Microfinance institutions reached 76.6 million against last year’s 59 million, according to the “State of the Sector Report” released on Monday in New Delhi. Compiled by N. Srinivasan, the report was released as part of the annual Microfinance India Summit 2009 at Hotel Taj on Monday morning. Some quick highlights of the report are:
* MFI’s have recorded about 8.5 million clients during the year 2008-09, a growth of 60% over the previous year. . . . → Read More: India microfinance records 30% growth: State of the Sector report
By Microfinance Focus, on October 27th, 2009% STRAIGHT FROM THE FLOOR:
Sushil Kumar, Livelihood Specialist (North), V-Shesh
Indian microfinance is quite different from Bangladesh or any other country’s MF sector. We are different in various regards, i.e. culturally, politically, religious and so on. We need our model rather then then experimenting with non-idealist models and implementing models that are by and large failures of finance. But this will take a generation.
Better disclosure will create more faith in the sector
Shailendra S. Bisht, Assistant Professor, IBS (Hyderabad)
. . . → Read More: VOX POPULI: Indian Microfinance Needs its Own Model
By Microfinance Focus, on October 27th, 2009% MFI should be a Profit Making body and not as a Super profit making body. Super profit making is just an exploitation
Elias Ghosalkar, Head, Micro finance Development initiative, BNP Paribas India.
By Microfinance Focus, on October 27th, 2009% Annual interest rates have no meaning. Rate of interest has to be linked with rotation of money in the business i.e. How money is used by the clients – whether the rotation of money is 5 times or 10 times in a year.
Y.C .Nanda, Former Chairman, NABARD.
By Microfinance Focus, on October 27th, 2009% Micro finance portfolio constitutes 1.3% of total bank credit, which means that it is a Significant sector as it exceeds 1% of total bank credit. If the share of micro finance exceeds 4% of the total bank credit, then it will become the “Systematically Important sector”
N.Srinivasan, Author, Micro finance India-State of the sector report 2009.
By Microfinance Focus, on October 27th, 2009% NABARD’s goal is to make the SHG Bank linkage program reaches 100 million households by the year 2015
U.C.SARANGI, CHAIRMAN, NABARD.
By Microfinance Focus, on October 26th, 2009% Social Performance Management (SPM) Tools
Gomby Maramba (Research Director, NWTF)
Progress out of Poverty Index helps assess whether institutions are helping clients move upward or downward NWTF now has a separate client department that helps clients obtain the best from us. We assumed that clients knew how to best run their business but many were not aware of industry best practices – we are able to share operational expertise The PPI will not give you many . . . → Read More: Breakaway Session: Social Performance Management
By Microfinance Focus, on October 26th, 2009% Introduction
For sector funded with the help of many visionary women, women’s leadership in the sector is declining Microcredit was introduced into India in the 1970s by three pioneering women by using a government scheme to provide loans to women from families suffering from economic crisis
Joez Deshmuk-Ranadive, Director, School of Microfinance for Women
Issues facing Women in Leadership positions:
Women face considerable pressures from family and community in leadership positions – increase the more with the level of success . . . → Read More: Breakaway session: Women’s leadership in Microfinance
By Microfinance Focus, on October 26th, 2009% Introduction
For sector funded with the help of many visionary women, women’s leadership in the sector is declining Microcredit was introduced into India in the 1970s by three pioneering women by using a government scheme to provide loans to women from families suffering from economic crisis
Joez Deshmuk-Ranadive, Director, School of Microfinance for Women
Issues facing Women in Leadership positions:
Women face considerable pressures from family and community in leadership positions – increase the more with the level of success . . . → Read More: Breakaway session: Women’s leadership in Microfinance
By Microfinance Focus, on October 26th, 2009% Poor often cannot save because of minimal deposit requirements and fees But will pay for expenses by getting a pawn loan on jewelry – huge expense to borrow – up to 30% to get a loan against jewelery for example Development thinking behind microfinance is focused on productive capacity – but forget non-productive financial flows By providing savings services you are removing a large cost to poor families and increasing financial security.
By Microfinance Focus, on October 26th, 2009% Poor often cannot save because of minimal deposit requirements and fees But will pay for expenses by getting a pawn loan on jewelry – huge expense to borrow – up to 30% to get a loan against jewelery for example Development thinking behind microfinance is focused on productive capacity – but forget non-productive financial flows By providing savings services you are removing a large cost to poor families and increasing financial security.
By Microfinance Focus, on October 26th, 2009% Successful examples in Africa and Asia prove that savings for the poor can be done – but banks are still finding outreach difficult Savings are a smoothing process – to address fluctuations in income and expenditure Striping down features for “no frills accounts” is not a large enough paradigm shift to reach most of the poor People will pay more to access savings through intermediaries rather then banks if the opening hours are convenient less distance to travel.
By Microfinance Focus, on October 26th, 2009% The poor save even if they do not have access to financial institutions – it is important to survival but savings has become the “forgotten” half of microfinance SHG linkages can be the answer but SHG savings to credit ratios have actually declined SHGs need to do more to mobilise savings to realise their potential to “fill the gap” LAB in India is successfuly offering daily avings collection in Karnataka Individual balances may be small but together can be . . . → Read More: Breakaway session : Why savings are important for the poor
By Microfinance Focus, on October 26th, 2009% C.S.Ghosh, CEO of Bandhan microfinance, on Commercialization
Microfinance Focus: Has the growing commercialization of microfinance institutions impacted the MFIs’ commitment to address alleviating poverty as their primary objective?
Irrespective of its impact, I believe that commercialization is necessary. An institution cannot become sustainable until it is commercialized. Subsidy can never give sustainability, it will only give dependence – all of us are aware of this, but tend to ignore this sometimes. In order to alleviate the large scale poverty in . . . → Read More: Commercialization is necessary for microfinance : Bandhan chief
By Microfinance Focus, on October 26th, 2009% ” To reach 1.2 billion people you need profitability,”commented Swaminathan Aiyar, who also built up a strong case in favour of competition and multiple lending. A successful SKS IPO would attract domestic ivestors into the microfinance sector. A greater inflow of equity would enable MFIs to increase their outreach.
By Microfinance Focus, on October 26th, 2009% According to the State of the Sector report competition is often important it can also impair quality and discipline.
The report stresses that competition also affects customers, not just MFIs, and the easy availability of loans has driven customer over-indebtedness. Competition can adversely affect MFIs’ internal control systems
By Microfinance Focus, on October 26th, 2009% Princess Maxima pitched for the development of savings products for the poor. `She cited the examples of Uganda and Kenya, wherein savings levels had tripled as a result of microfinance focus based initiatives. She urged the Indian government to create an enabling legal framework for boosting micro-savings. MFIs can play a pivotal role in promoting low cost housing,energy and healthcare.
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About Microfinance Focus Microfinance Focus (MF) is an online knowledge platform about microfinance and sustainable development. Our worldwide recognition has been driven by a great need for shared information regarding the industry. Much of this growth can be attributed to our commitment to help the industry excel by plugging the knowledge gap, via free access to news and information that will benefit microfinance institutions (MFIs) and their practitioners.
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