Microfinance in India - A State of the Sector Report, 2007

Publication Date: 2007
Published by: Access Development Services, Ford Foundation & Swiss Agency for Development and Cooperation (SDC)
Document Type: Paper (PDF)

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This report presents the latest developments, issues, recommendations and achievements of the Indian microfinance sector.

This India state of the microfinance sector 2007 report contains:

• Two chapters on progress under each of the two main models of microfinance in India, viz. linkage banking and MFIs.
• New topics that are of significance to the sector, such as Self Help Group (SHG) federations, evaluation of social performance, urban microfinance, developments in technology, and perspectives on regulatory issues.

The report makes the following points:

• The growth of the microfinance sector continues to be rapid;
• Not all microfinance borrowers are poor;
• The sector needs to pay more attention to depth of outreach and other quality issues;
• The on-lending funds constraint makes a reappearance;
• Private equity also makes an entry but its implications are not yet clear;
• The new Microfinance Bill takes an important step forward in allowing NGO-MFIs to mobilize savings, but limits savings to “thrift;”
• The Bill excludes the larger, more rapidly growing art of the sector;
• The sector’s infrastructure of support services is gradually strengthening.

The report contains the following articles:

• Progress Under the SHG-Bank Linkage Program – Prabhu Ghate;
• SHG Federations: Financiers or Nurturers? – Prabhu Ghate;
• MFI Performance: Efficiency with Growth – Sanjay Sinha;
• Urban Microfinance – Prabhu Ghate;
• Social Performance in Indian Microfinance – Frances Sinha;
• Microinsurance – Sai Gunarajan;
• Microfinance and Technology – Prashant V. Regy and Vijay Mahajan;
• Regulation: the Microfinance Bill: An Opportunity Being Lost? – Prabhu Ghate